Are car insurance comparison sites a con?
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clivep
Posts: 577 Forumite
My car insurance with Aviva will run out in a month's time so it's time to get all the quotes again.
Aviva renewal is about £210 less £20 if renewed online so £190 net. This is with £350 total excess.
Saga sent me a letter asking me to consider them again (I'd been with them the year before Aviva) with an estimated price of £209. On checking, their site quoted £215 with £350 total excess, (£213 with a £400 total excess). I'd get £30 cashback from TopCashBack with this making it £185 so not really worth bothering to change.
Following MSE suggestions I looked at the other direct sites:
Direct Line £208 less £20 cashback so hardly any benefit there.
Zurich was £456!!!
As for the comparison sites:
Moneysupermarket cheapest £251, Saga £300 with £400 excess.
Confused cheapest £228, Saga £281 with £400 excess.
GoCompare cheapest cheapest £210, Saga £229 with £400 total excess.
CompareTheMarket cheapest £211, no price for Saga.
So none of the sites gave anything better than my Aviva renewal but what surprised me was how much extra they were charging for Saga compared to the price on Saga's site.
I know the comparison sites have to pay for all their adverts somehow but I thought this would have been through commission rather than ripping off the end user.
Aviva renewal is about £210 less £20 if renewed online so £190 net. This is with £350 total excess.
Saga sent me a letter asking me to consider them again (I'd been with them the year before Aviva) with an estimated price of £209. On checking, their site quoted £215 with £350 total excess, (£213 with a £400 total excess). I'd get £30 cashback from TopCashBack with this making it £185 so not really worth bothering to change.
Following MSE suggestions I looked at the other direct sites:
Direct Line £208 less £20 cashback so hardly any benefit there.
Zurich was £456!!!
As for the comparison sites:
Moneysupermarket cheapest £251, Saga £300 with £400 excess.
Confused cheapest £228, Saga £281 with £400 excess.
GoCompare cheapest cheapest £210, Saga £229 with £400 total excess.
CompareTheMarket cheapest £211, no price for Saga.
So none of the sites gave anything better than my Aviva renewal but what surprised me was how much extra they were charging for Saga compared to the price on Saga's site.
I know the comparison sites have to pay for all their adverts somehow but I thought this would have been through commission rather than ripping off the end user.
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Comments
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I know the comparison sites have to pay for all their adverts somehow but I thought this would have been through commission rather than ripping off the end user.
How do you think the commission is paid for? It is factored into the premium.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Not a con but you have to be careful IMO.
Not had my car insurance renewal this year yet but have certainly saved on our holiday hotel by going direct to the hotel rather than say Quidco even after the cashback.0 -
How do you think the commission is paid for? It is factored into the premium.
Yes, factored into the premium not added on top of the premium as well.
The commission amount on most things is usually the bit that you could get back from a cashback site rather than the price being loaded as well.
e.g. In the case of Saga that I quoted, I'd expect Saga to pay the comparison site at least £20 commission but not see an extra £80 + added to the premium giving the comparison site more than £100 on a £300 premium.0 -
I previously sold policies through comparison websites. The charges to as a brokers for each policy sold were £48, £50 and £55 for the big three selling combined buildings and contents. The charge on motor was £75 on one and £90 on another (we never bothered selling it online as a broker as couldn't justify these fees and many of our schemes did not permit online sales.) I imagine the big boys pay a fraction of what we paid as an independent brokers/MGA but we were transacting between 1k and 2k policies per month. The fees of these sites are a huge extra cost that most people massively underestimate.Lloyds broker working in Private Clients and Property Owners.
Looking to help and be helped.0 -
Yes, factored into the premium not added on top of the premium as well.
The commission increases the premium.The commission amount on most things is usually the bit that you could get back from a cashback site rather than the price being loaded as well.
Some of the commission is. Not all.e.g. In the case of Saga that I quoted, I'd expect Saga to pay the comparison site at least £20 commission but not see an extra £80 + added to the premium giving the comparison site more than £100 on a £300 premium.
Sometimes the product sold via comparison sites is different to the product sold direct. I don't know if that is the case here.
Also, the pricing models for each distribution channel are not consistent across the board. The provider may want to boost the sales on its direct offering whilst not wanting to do the same on the comparison site offering (or vice versa)I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Hi, just to let everybody know.
LV now have multi car insurance and have just saved a further £55.
2 cars fully comp for £349.66. against £405.02 from Aviva.0 -
I gave up using Quidco a couple of years ago when I set about renewing car insurance and did some investigating using different computers to do comparisons for quotes.
It worked out better to go to the companies direct. I would find my best quote and then go to the company direct using another computer and got a better quote than using the comparison site.
I then started doing it when I was buying things and found it cheaper to cut out the cashback site. I know some people swear by them and I did get back nearly £2000 from Quidco in 6 years.
Take the site with the 2 Russian Cats! They have to increase the premium to pay for the cuddly toy that takes 3 months to walk from some Stan! :rotfl:Well worth doing if you go to the cinema on a Tuesday or Wednesday!3.795 kWp Solar PV System. Capital of the Wolds0 -
The only one that I'd previously come across was AutoEurope for car hire where I've found the price to always be cheaper direct rather than through TopCashBack. Only by a few £ though so usually it still works out cheaper with the cashback.
On the MSE Cheap Car Insurance page it says "We've also conducted separate research to see if quotes from comparisons match up to the prices on insurers' own websites, how easy it is to use the sites, and the speed at which the sites deliver results" yet it does not appear to give any details of such quote comparisons research.
The steps to a good deal listed are:
Step 1: The top comparison sites
Step 2: The ones comparisons miss
Step 3: Hot deals comparisons miss
Step 4: Haggle
Step 5: Get cashback
Step 6: Check your policy
Step 5 says that once you know who your cheapest provider is, you need to check there aren't any hidden cashback deals. However, I can't see anywhere the suggestion to check the cheapest comparison deals to see whether going direct would save more money for the same policy.0
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