Car Insurance Arrangement fees - price comparison sites should have option to exclude

Brand

1st Central charges an additional fee of £50 to set up a policy.  yet this does not show up in price comparison. 

It would be good if price comparison site result lists   allowed users to exclude such companies in the results list, or, at the very minimum, to work with the full price including any such compulsory introductory charges.

facade

I didn't realise this, seems rather naughty to exclude a compulsory fee, which is part of the price.

When I go to the Meerkats or whatever, I ignore the ones that are suspiciously cheap anyway, unless they are a known brand who are giving an outlier quote to get my business.

I pick a company that I recognise from the lower end of the clump.

A £50 fee (or even more) explains why there can be such a gap between the no-names and the herd.

DullGreyGuy

Brand said:

1st Central charges an additional fee of £50 to set up a policy.  yet this does not show up in price comparison. 

It would be good if price comparison site result lists   allowed users to exclude such companies in the results list, or, at the very minimum, to work with the full price including any such compulsory introductory charges.

They do?  Get the same price after clicking through as the aggregator showed, it's just more broken down on their site. 

Brand

DullGreyGuy 

well if you are right, then I am wrong and apologise for misinforming.

I got to the very end of the 1st Central process, then it said: There is a £50 arrangement fee, 

so I stopped there and 

sought other quotes from other companies (which were of course another £100 or so p.a.)

In the list of "What's included" it doesn't mention arrangement fee.

(The only time I've ever encounted an arrangement fee for car insurance was long ago using a high street broker, (a charge which is what you'd expect )

DullGreyGuy

Brand said:

In the list of "What's included" it doesn't mention arrangement fee.

There are many ways to skin a cat and equally different ways an intermediary can make money by selling insurance. Some charge an arrangement fee, some take higher commissions, some have profit share arrangements etc. Some want to make their money on the sale of the insurance, some will take less on the sale but make more via mid term adjustment and cancellation fees. Some partner with accident management companies so have a good revenue from claims. 

A company has to say if asked what the various fees and commissions are, some will tell you without you asking. However profit shares are naturally difficult to say at the point of sale as normally they are settled 3 years later based on the total book of sales in that year and their claims experience. 

Brand

Thanks DullGreyGuy that's very informative.

BenTheRed

I think this is a good idea. I've just taken out car insurance with Vavista and saw that they've thrown in an arrangement fee of £88 is on top of the £323 premium - 27% of the total bill - is this a rip-off? 

MyRealNameToo

BenTheRed said:

I think this is a good idea. I've just taken out car insurance with Vavista and saw that they've thrown in an arrangement fee of £88 is on top of the £323 premium - 27% of the total bill - is this a rip-off? 

Take off IPT and its under £80, confused.com etc will be taking the majority of that from them. Their software provider will also be taking a slug of it. 

As previously said though, it depends if they are also getting a percentage of the premiums... traditionally the margin on motor for brokers was tiny and wouldnt even cover the cost of sale.