Money Saving Expert founder Martin Lewis has issued an urgent alert to millions of UK motorists, warning of an impending financial trap that could cost drivers hundreds of pounds.
The consumer champion's latest warning comes as the Financial Conduct Authority (FCA) prepares to implement new rules in April that will fundamentally change how insurance providers calculate premiums.
The Looming Insurance Price Shock
Lewis revealed that insurers are currently setting prices based on how much a customer is likely to pay, but this controversial practice will soon be banned. The new regulations will prevent companies from charging existing customers more than new ones for the same coverage.
"This is a big, big change," Lewis emphasised during his appearance on ITV's The Martin Lewis Money Show. "What they're doing at the moment is they're pricing based on what's called 'price walking' - how much they can get away with charging you."
The Critical Two-Week Window
Lewis identified a specific danger period that could catch millions of drivers off guard. He warned that insurance companies might attempt to push through significant price increases before the new rules take effect.
"There is a concern that some of the companies may try and put their prices up before then," he cautioned. "So if your renewal is coming in the next couple of weeks, you need to be extra careful."
How To Protect Yourself From Overpayment
The money expert provided clear, actionable advice for drivers facing renewal in the coming weeks:
- Never auto-renew without checking: Loyalty often penalises rather than rewards in the insurance market
- Use comparison sites: Always shop around to ensure you're getting the best possible deal
- Check your renewal quote carefully: Be particularly vigilant if your premium has increased significantly
- Negotiate with your current provider: Use cheaper quotes from competitors as leverage
Lewis stressed that while the new rules will eventually create a fairer market, the transition period presents particular risks that consumers need to navigate carefully.
"The FCA is bringing in a new regulation that says they must offer equivalent pricing to renewing customers as new customers," he explained. "That should, in theory, mean that the automatic renewal is the right price."
For now, however, the message remains clear: every driver must take proactive steps to avoid being overcharged during this regulatory transition period.
