The Financial Conduct Authority (FCA) is undertaking a comprehensive market study into the insurance sector, focusing on the fairness of premium finance products used for motor insurance.
The move comes alongside the launch of a new government motor insurance taskforce, aimed at addressing increasing insurance costs.
Premium finance allows policyholders to pay their insurance in instalments, but with annual borrowing rates typically ranging between 20-30%, the watchdog is concerned over whether customers are getting fair value.
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