Probe into how insurers set prices

INSURERS are to be probed over claims they are hiking costs for customers with names that are common among ethnic minority communities.

Insurance firms use complex algorithms that take into account huge amounts of data when deciding how much to charge customers.

There are concerns that these computer programmes are singling out people with certain names as a higher risk than others. Two investigations conducted by The Sun and the BBC’s You and Yours radio show, found that customers with the name Mohammad are charged more than those with traditional English names.

Insurers deny using a person’s race to set premiums. But the City watchdog has revealed that it will be investigating the accusations. The Financial Conduct Authority is now extending consumer data research to look at whether customers’ names can impact on the cost of car cover.