Are price comparison sites pushing up the cost of insurance?
Have you ever used a price comparison site? Most people have, as, on the surface, they look like they’re showing you the best value insurance quotes on the market. Due to the sheer volume of people who buy their cover through price comparison sites, many insurers have been backed into a corner and are forced to pay these websites to display their policies.
Hidden fees
The fees charged by these websites vary between £60 and £160 per policy. The insurers paying these charges then need to recoup these costs by upping the prices of their policies. The pricing structure adopted by price comparison sites tends to favour big-name insurers, at the expense of smaller companies. The exact nature of these pricing plans are undisclosed and none of the major companies would shed any light on them upon request.
Affecting the wider marker
Even if you choose to purchase your cover directly through an insurer or a trusted broker, many price comparison sites included clauses in their contracts which prevents insurers from offering policies at a lower price elsewhere. In short, every car owner is affected regardless. Apart from the under 25 market, research shows that car insurance has gone up for every other demographic of car owners between 2014 and 2019.
Working in tangent
Whilst in reality, there are no restrictions on price comparison sites trying to undercut each other with more competitive policies, they tend to all charge similar fees. It’s clear that they know what the other charges.
Not asking the right questions
While many believe that these sites offer the best deals, many don’t ask the breadth of questions required to fully understand the cover you need. For example, many people use dashcams which can serve to lower your insurance premiums, but out of the four major players, only GoCompare asked if drivers used these cameras.
Even the smallest detail could have a big impact on your insurance, right down to your job title. You may be tempted to choose a title which is similar to your own if your exact title isn’t available, only to find you’re paying more than you should be. When you go through a broker or directly through an insurer, they will clarify the exact details required to get you a fair quote.
Getting the best value for money
It’s clear that while price comparison sites are useful for finding competitive cover, their presence actually appears to be a detriment to the consumer. Their secret fees are pushing up insurance prices across the board and it’s affecting everyone, not just users of these sites. So, is there something you can do? While we can’t go against a contractual agreement, we can promise that we will strive to get you a fair and competitive deal on your insurance.
Not only do our team have a deep understanding of the market, we understand the different options available and how your policy will be affected by different variables. Whether you’re a start up business, have recently suffered a claim, have several trades or something else, we can help you get the protection you need. To get an insurance service which truly takes your circumstances into account, get in touch with EIC Insurance Services either via email or on 01442 286910
