UK insurers may be forced to publish claims data under proposals by the outgoing financial regulator.

The move would give consumers a better understanding of insurance products, according to a discussion paper on market transparency from the Financial Services Authority (FSA).

It follows concerns from consumer groups that policies are paying below customer expectations.

If implemented, the policy would be enforced by the new Financial Conduct Authority (FCA), which will regulate financial markets from April.

“Publishing information about which firms pay out on insurance products could help to address concerns that insurers seek to avoid paying out,” the paper says.

“It would send a signal to the market about the relative performance of both firms and sub-sectors of the insurance market.

“Publishing this data in a way that consumers would understand and pay attention to could improve their choices of insurance providers and help them avoid low-value products.

“Done well, this work could deliver real transparency about the genuine value or otherwise of products, which would tell a really compelling story for consumers.”

The FSA concedes the proposal may not be effective across all insurance lines but it is keen to explore how “add-on and non-core products” including warranty, home emergency, identity theft and mobile phone cover would be affected.

Data sets including claims per customer, successful claims percentage after initial contact, premium-to-payout ratios and claims reduced/refused for non-disclosure have been suggested for public release.

“In pursuing this option we would need to agree the level of detail and the methodology required to deliver the most accurate information and to create an appropriate impact,” the paper says.

The FSA proposes a range of transparency measures for the market and the FCA itself, including more feedback to whistle-blowers on the cases they report to the regulator.

“Transparency cannot be an end in itself,” FCA CEO designate Martin Wheatley said. “We want to make sure disclosure helps customers make the right decisions when purchasing products and helps the market function more effectively.”