Have you been overcharged by Direct Line?

Direct Line customers are in line for a pay out after the insurer was ordered to pay more than £30 million in compensation for overcharging.

The pay out comes after Direct Line admitted it had made an error in implementing the financial watchdog’s new pricing rules, meaning existing customers were charged more for their car or home renewal than they would have been if they were a new customer.

The FCA introduced the new rules at the start of 2022 to prevent existing insurance customers from being quoted prices higher than new customer offers.

Direct Line said: “An error in our implementation of these rules has meant that our calculation of the equivalent new business price for some customers failed to comply with the regulation.

“As a result, those customers have paid a renewal price higher than they should have.”

The insurer, one of the largest in the UK, hasn’t said how many households have been affected – not all have been overcharged – or who will receive compensation, but it believes the pay out will be in the region of £30 million.

How do you apply for compensation?

Direct Line said it’ll be contacting affected customers directly and people don’t need to do anything themselves at this stage.