Our look at UK car insurance
brokers
Before
price comparison sites came along, the car insurance brokers were a
popular choice as a good way to save money on quotes. They did,
however, have their drawbacks. The main one was that car insurance
brokers were well aware of the size of the commsisions paid by
each of the companies on their panel and this could, and often did, act
against the consumer getting the best value quote in favour of the
broker maximising profits, the commissions being how they made their
money.
Price comparison sites check lots of brokers and companies directly
and, while brokers used to check perhaps around 30 car insurance policy
prices, these price comparison sites now check hundreds, even
thousands, of quotes.
By this means the consumer may still pick one of the car insurance
brokers for his cover but he is much more likely to find that cover via
a price comparison site than by going direct for it.
One useful effect of price comparison sites on the behaviour of car
insurance brokers is that they can no longer remain competitive by
prioritising their commission over offering value to the customer given
that they are now competing with so many other providers via the prices
generated by price comprison sites. This is good for the public, if not
for the individual broker's profits.
Of course price comparison sites themselves are, in effect, giant car
insurance brokers; so, are there any influences on them that could
mitigate against the customer getting the best deal? The simple answer
to this is 'no'. The reason being that price comparison sites are in
tough competition with other price comparison sites. Were they to allow
commission structures or any other influences to reduce their
competitiveness, they would quickly lose market share.
That said, there is a risk - perhaps more theoretical than of any great
practical significance - that those price comparison sites that are not
independent of insurance companies could prioritise their 'in-house'
brands. There is probably little if any need to be concerned about this
in practice, however.
To get quotes via a good car insurance broker or price comparison
system, this insurance
supermarket is a good
resource to
use. Despite the popularity of these aggregator systems, there remain
good reasons for going direct instead. The main reason is to easily get
a good standard of cover as this is usual when you buy direct from a
top car insurer. The same cannot be said of the very cheap quotes
presented by price comparison sites.
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