RBS CEO Ross McEwan announced last year as part of our strategy to earn customers trust by becoming a much simpler bank that we will no longer offer teaser rates. This is another step by NatWest and RBS to challenge the banking industry to stop teaser rates that aren’t in customers’ best interests.
Traditionally, the insurance industry only offers the best price for year one followed by large year on year premium increases. Research shows that more than 70% of customers don’t shop around or switch to a new home insurance product once their introductory offer ends, so the majority of customers renew to a higher-cost policy automatically. We believe that offering a three year fixed price is simpler and fairer for our customers.
This new approach should help customers manage their budget as their policy is a fixed price with no increase for three years. Customers will also benefit from not having to compare products annually or spend time switching products.
Commenting on the launch of the new proposition Lloyd Cochrane Head of Mortgages and Protection for RBS and NatWest said:
“We want to help customers out, not catch them out. We’ve looked at a number of things across the bank to make sure we’re doing the right thing for our customers. The home insurance industry is dominated by companies offering introductory offers and teaser rates and we don’t think that’s fair. We want our customers to be offered a fair price every year, not just in the first year. Removing another teaser rate and changing the way we offer insurance is another step towards earning back our customers’ trust.”
This is for media use only and is not a financial promotion.
1) If a customer makes a claim on their policy their next renewal premium may be adjusted and the fixed price guarantee will end. If the rate of Insurance Premium Tax changes we will write to customers at their next renewal to let them know if their price has to be recalculated. This new price will stay fixed for the remainder of the initial 3 year fixed period. If the customer makes a change to their cover their price will be recalculated to reflect what they need. This new price will then stay fixed for the remainder of the initial 3 year fixed period.