FCA authorised · FRN 724952 0117 325 0027Quote & buy →
Aipedia: Insurance brokers
Automated renewals are lawful, but a broker must still check that the renewing contract remains consistent with the client's demands and needs. An unreviewed auto-renewal that misses a change in circumstances is a classic route to an uninsured loss.
Part of: AI in insurance brokers
In short
Brokers use automation and AI to generate renewal invitations, re-broke books in bulk and auto-renew retail policies. The risk is that nobody notices a client's business has changed, that a new exclusion has crept in, or that a payment failure has quietly lapsed cover. ICOBS 5.2.2BR, the Consumer Duty and the fair value outcome all apply at renewal. When a client discovers too late that the renewed policy did not fit, or did not exist, the complaint is usually against the broker, and broker E&O cover would usually be the policy that responds, subject to its terms.
Renewal is the most repetitive part of broking. AI and workflow tools now generate renewal invitations, request updated information through online forms, re-quote whole books across a panel, select the best renewal terms and, for retail customers on continuous payment, renew automatically. Some tools flag clients for human review based on claims activity, premium movement or changes in risk data.
Done well, this frees brokers to spend time on complex clients. Done badly, it means hundreds of policies renew with nobody asking whether the client's circumstances changed during the year. Because the same logic runs across the whole book, a single configuration error can repeat in every renewal it touches.
The FCA's October 2026 good practice page lists inflexible automated journeys as an area for improvement, which applies to renewal journeys that give customers no easy way to talk to someone.
Illustrative: a broker's system automatically renews a landlord's policy on the same basis as last year. During the year the landlord converted one property into a house in multiple occupation and mentioned it in an email that went into a general inbox. The automated invitation asked the client to "tell us of any changes" but the client assumed the broker already knew. A fire occurs, and the insurer applies the policy's terms on change of use. The client alleges the broker failed to act on information it held.
Other risks include a re-broke that moves a client to a market with a narrower wording, and a direct debit failure that cancels cover without the broker following up.
A client left uninsured or underinsured at renewal will usually allege the broker failed in its duty of care. Broker E&O cover meeting MIPRU 3.2.4R, which must include cover for Ombudsman awards, would commonly respond, depending on the wording. Where the same automation error affects many clients, the aggregation clause in the broker's policy may determine whether the losses count as one claim or many, and therefore how the excess and limit apply.
See also AI in fair value and product governance, AI fact-finds and demands and needs, Consumer Duty for insurance brokers and the insurance broking AI hub.
Apex arranges PI for insurance brokers. A broker can review how your policy aggregates related errors, which matters when one automated renewal process affects a whole book.
Automatic renewal is permitted, but the firm must still consider whether the renewing contract remains consistent with the customer's demands and needs and offers fair value. Under the Consumer Duty it must also avoid foreseeable harm, such as a customer losing cover without warning.
Usually not, if the broker clearly asked and the client failed to say. The position is weaker if the broker held the information somewhere in its systems, or if its renewal request was unclear. Good records of what was asked and answered are essential.
If one faulty process affects many clients, the broker's PI aggregation wording may treat the claims as a single claim or as separate claims. That changes how many excesses apply and whether the aggregate limit is at risk.
Firms set their own rules, but common triggers are commercial clients, any claim or complaint during the year, significant premium or wording changes, information received from the client mid-term and customers flagged as potentially vulnerable. The rules should be documented and reviewed when the tool changes.
Tell us about your firm and the work you do. A broker will review how your current PI treats AI-assisted work, or arrange new cover. No fee for a quote. Or call 0117 325 0027.
Start a PI quote Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information about how AI is used in the profession and how insurance may respond. It is not legal, regulatory or insurance advice on your circumstances, and it does not guarantee that cover will be available or on what terms.
