The Central Bank of Ireland (CBI) published a Review of  Differential Pricing Regulations in the Private Car and Home Insurance Markets on 20 December 2023. The Regulations, which were commenced in July 2022, are formally known as the Central Bank (Supervision and Enforcement) Act 2013 (Section 48 (1)) (Insurance Requirements) Regulations 2022, i.e. S.I. No 126 of 2022. The Review discharged the CBI’s obligations under Section 6 of the Insurance(Miscellaneous Provisions) Act 2022, which required the CBI to prepare and submit a report to the Minister for Finance within six months of the first anniversary of commencement of the Regulations( i.e. 18 months) setting out: The opinions of the Bank in relation to insurers’ oversight of pricing practices Measures implemented by the Bank in relation to price walking Measures implemented by the Bank in respect of automatic renewals of non-life insurance policies The Bank’s conclusion as to whether further measures are required in relation to any of these matters. To recap on two definitions, the CBI has defined differential pricing in insurance services as a circumstance or practice whereby customers with a similar risk and cost of service are charged different premiums for reasons other than risk and cost of service. Meanwhile, according to the CBI’s Review, price walking is where customers are charged higher premiums relative to expected cost the longer they remain with an insurance provider. The Review essentially summarised  the measures the CBI has taken and the work insurers have done with regard to these Regulations. The CBI observed much more robust oversight processes, analysis and reporting by insurance providers in relation to their pricing practices and models and how these affect their customers. The Review also made some findings about automatic renewals, which are outlined below. However the headline finding was that motorists and homeowners on their second or subsequent renewal are not charged a higher premium by insurers than someone else on an equivalent year one renewal. In other words, price walking does not occur, having been banned in these Regulations following the CBI’s 2021 Review of Differential Pricing, which concluded that the practice of price walking could result in unfair outcomes for some consumers. At the same time, the Regulations allow insurance providers to continue to provide discounts for new business customers and ensure that consumers retain the opportunity to get a better-priced premium through switching insurance provider. This means that there are still benefits to be had from shopping around – something which Insurance Ireland would always advocate and the reason we lobbied for the retention of new business discounts. Meanwhile for those who are not inclined to shop around for whatever reason, this Review provides comfort that they will not suffer from price walking over time. The Regulations also contain provisions with regard to automatic renewals of all personal insurance products in the non-life insurance market, i.e. that: The consumer must be permitted to cancel the automatic renewal of a policy at any time, and Notifications must be issued to consumers in advance of their renewal date with specified information to be clearly set out, including the steps necessary to exercise the right of cancellation. The Review found that insurers have adhered to the new disclosure requirements in the Regulations. As to whether there should be an explicit opt-in requirement to automatic renewals, the CBI took the point that Insurance Ireland made in its 2021 submission to the CBI, that such an opt-in process could have serious consequences in areas such as motor, home and health where there would be a risk for consumers of becoming inadvertently uninsured. Therefore, having weighed up the risks and potential benefits, the CBI propose to proceed on the basis of an opt-out basis for home, motor and health and on an opt-in basis for travel, gadget, dental and pet insurance. In summary, the Review found that the Regulations are working effectively. The CBI is satisfied that no further measures are required at this time but they will consult further on their opt-in proposal with regard to automatic renewal of travel, gadget, dental and pet insurance as part of their forthcoming Consumer Protection Code Consultation Paper.