AXA UK said it would make its pricing simpler from 1 January 2022, so that a new quote and a renewal quote on the same day are the same price, based on the customer's own circumstances1. The insurer said the change followed the Financial Conduct Authority's general insurance pricing review, and that it supported the new rules, which it said would make it easier for customers to change their renewal preferences and would ensure renewal quotes for car and home policies are not higher than a new quote1.
"Whether you're new to us or renewing with us again, the price on the day will be same, based on your own unique set of circumstances."
The company said the change does not mean policies will always be cheaper. It said pricing would be simpler rather than always cheaper, and that there can still be occasions when a new quote is cheaper than a renewal, for example where there are differences between the two, because even small changes can affect the price1. AXA also said it would tell customers their renewal price around 25 days before the renewal date1.
On renewals, AXA said customers can switch their renewal preference at any time and as many times as they like, either through their online account or by message or email1. If a customer removes automatic renewal, cover ends at the time and date shown on the renewal email or letter, and AXA noted there may be a gap in cover if a new policy is not bought, adding that car insurance is a legal requirement for owners of a roadworthy vehicle1.
| Element | What AXA set out |
|---|---|
| Effective date | 1 January 20221 |
| Pricing basis | New quote and renewal price the same on the day, based on individual circumstances1 |
| Renewal notice | Around 25 days before the renewal date1 |
| Preference changes | At any time, as often as the customer likes1 |
| If automatic renewal is removed | Cover ends at the time and date on the renewal email or letter1 |
Why it matters for households
The change affects AXA car and home insurance customers quoted or renewing from 1 January 20221. For those customers, the price offered as a new customer and the price offered at renewal are the same on the day, so the gap that could open up between an introductory quote and a renewal quote is removed at this insurer1. AXA states this makes pricing simpler, not necessarily cheaper, so a household's premium can still rise or fall from one year to the next depending on its circumstances1. Renewal notices arriving around 25 days before the renewal date give customers that window to compare cover or change their renewal preference before cover continues or ends1. Where automatic renewal is switched off, cover stops at the stated time and date, and any gap in car cover matters because insurance for a roadworthy vehicle is a legal requirement1.
What happens next
The pricing change took effect on 1 January 20221. AXA has not reported any further dated steps beyond that date. The FCA's rules on general insurance pricing are covered in our guide to insurance pricing rules, and the mechanics of premiums in how insurance premiums are worked out. Customers weighing up whether to let a policy renew automatically can read about insurance renewals and automatic renewal, and AXA's own arrangements are set out on our AXA page.
Sources1 cited
- Pricing and renewal update | AXA UK axa.co.uk
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