Displaying previous-year premiums on renewal notices without context may encourage customers to make price-based decisions rather than considering if they have the right cover, Suncorp warns.

The insurer says it supports the proposed disclosure requirement in principle, but the reform should ensure consumers have useful information.

“There are a range of reasons why a customer’s premium may vary on renewal,” Suncorp says in a submission to the Productivity Commission inquiry into financial system competition. “They may have renovated their home, changed how their home is being occupied or changed their level of cover/excess.”

The insurer says it has already committed to providing comparison information for NSW customers and is closely watching responses as it refines its approach.

The Productivity Commission’s draft report is critical of the “illusion” of competition created when numerous brands are underwritten by a handful of insurers, and proposes increased transparency.

Suncorp says its brands have different features and benefits and target separate markets, while the group’s Marketplace strategy encourages greater understanding of product range.

The submission says the industry is highly competitive and new players are constantly emerging.

“It is also often acknowledged that the insurance industry will face intense disruption as start-ups and new market entrants find new ways to package products, assess risk and develop innovative distribution channels,” it says.