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Insurance Business | 02 Oct 2014, 07:17 AM Agree 0
A major insurance aggregator has responded to disparaging FSI submissions on price comparison websites, calling some comments a ‘fallacy’, a ‘contradiction’ and ‘nonsensical’.
  • Rachael | 02 Oct 2014, 09:22 AM Agree 0
    As they just said themselves - aggregators encourage price driven decisions made by customers rather than promoting best cover. Unlike going direct with a major insurer however, the aggregators offer an illusion of 'shopping around' so that consumers who are interested in comparisons would be less likely to seek advice from insurance professionals, even though initial quotes & advice are often free of charge from brokers.
  • Jack | 02 Oct 2014, 09:23 AM Agree 0
    Budget Direct keeps advertising on TV that they won the award last year for being the cheapest insurer of the year! Ripper, let's see if we can now find someone even cheaper!! Hey! Do you actually get a policy with that cheap cheap cheap price?
    I wonder why there isn't a site that compares car prices? I wonder why Daewo doesn't advertise that they are cheaper than BMW?
    When will people understand
  • Jack | 02 Oct 2014, 09:25 AM Agree 0
    When will the public understand that they are buying a contract.... A piece of paper. They better hope to God they bought the right one when their house burns down. But hey, think if the premium they saved right?
  • Alan | 02 Oct 2014, 09:30 AM Agree 0
    Aggregators = Commoditisation = price being only differentiator.

    Need anymore be said
  • Dennis Reid | 02 Oct 2014, 11:00 AM Agree 0
    It is a valid point that the insurers by providing an online facility are as guilty as the aggregators.It would make more sense to give additional support to their intermediaries with competitive rates etc & let them provide a service to the customer instead of competing with their own agents.
  • Rachael | 02 Oct 2014, 11:04 AM Agree 0
    @Dennis - Saying that someone else is making the same mistake doesn't make it less of a mistake.
  • Terry | 02 Oct 2014, 02:43 PM Agree 0
    Brokers are in the box seat to provide an online market comparison for personal lines policies, both as regards coverage and price : it can't be that hard, Choice does it quite regularly!

    The trick is, of course, to find a truly independent and impartial broker who includes all market players and lists those not prepared to participate - could be quite revealing.

  • Eddie | 03 Oct 2014, 03:01 PM Agree 0
    I think most of the above comments have been written by employees at one of the large insurers who are scared witless by the growing understanding and appreciation of comparison sites. Seriously, what on earth are you all on about?

    Consumers are not stupid guys. We know how to compare products and make a decision. I am from the UK where comparisons are the main starting point for most financial services. Would you believe that "if your house burns down" insurers do still actually pay, wow! The whole industry is governed by higher powers so to suggest that your claims wont be paid if you purchase through a comparison is complete nonsense. You don't and won't ever see brands like "Alan's home insurance" for example Alan.

    Wake up Allianz / Suncorp / IAG etc, dip your corporate heads in a bucket of ice water - the consumer will always win and the consumers would like to use comparison sites. Consumers don't want to go through a complex set of questions on several different sites. They would rather just once, on one site, and then use their educated brains to make a decision on what to purchase, how outrageous.

    Compareinsurance.com.au and Comparethemarket.com.au are leading the Australian market. Both trains that cannot be stopped.
  • Rachael | 07 Oct 2014, 10:22 AM Agree 0
    @Eddie

    Yes a lot of people commenting are probably insurance professionals - who have seen first hand that consumers who don't take the time to educate themselves in insurance (ie the kind of people who can't be bothered spending time answering a lot of underwriting questions) might not make the best choices for themselves, which may lead to them thinking they are covered for something that is not covered, or is only partially covered, or that they have underinsured, or that they have chosen a ridiculous excess on.

    Just because you are well informed, educated, and take an active interest in insurance, please don't believe that all people are and do. The issue with these comparison sites is that they preach 'you don't have to know much to be an expert' and they play off the stereotype that insurers are out to screw the client. That can be dangerous when it comes to making bets on your livelihood.
  • Joshy | 09 Oct 2014, 10:11 AM Agree 0
    Any insurer that allows consumers to purchase directly through their website leaves the average Australian open to being underinsured.

    The same information displayed on an insurer's website (policy features, benefits, excess, price, policy documentation) is also shown on comparison sites. If anything, a comparison brings this information forward making consumers aware of the things that they should consider when comparing quotes.

    @Rachael - I've never seen a comparison make the statement that 'you don't have to know much to be an expert'. I suspect that these comments come from brokers that feel threatened by comparisons.

    There will always be a place for brokers, particularly when it comes to niche products and multi-policy discounts.

    However, for middle-class Australian's with a car insurance policy, rather than continually renewing your last policy because it is the easiest thing to do (which equally can leave consumers underinsured), comparisons have successfully highlighted that Australian's should take a more active interest in their insurance, understand what they are covered for and compare policies.

  • Daffy | 09 Oct 2014, 03:48 PM Agree 0
    It's not in the interest of the big insurers to have their prices compared easily with the challenger brands. Consumers would find that they could save money and ultimately prices would be driven downwards as the large insurers would have to respond with price decreases in order to keep up sales volumes. In saying this, consumers really do need to consider not only the price but the claims paying ability of the insurer that they entrust to protect them should an event occur. After all, insurance is simply an expensive piece of paper if, at the 'moment of truth', nothing happens (claim time).
  • Chris | 09 Oct 2014, 03:54 PM Agree 0
    @Rachael – you claim that by using comparison websites consumers can be left vulnerable as they ‘might not make the best choices for themselves, which may lead to them thinking they are covered for something that is not covered, or is only partially covered, or that they have underinsured’. Are you insinuating that consumers that purchase their insurance directly through an insurer will always have appropriate cover? If so, how do you explain the stories that frequently appear in the media depicting some poor Aussie battler that’s been screwed over by their insurer during their time of need despite paying 20 years of premiums?

    Please tell me when you’ve seen a comparison website say ‘you don’t have to know much to be an expert’, or indeed that ‘insurers are out to screw the client’. I’ve never in my long career in insurance seen anything of the sort.

    Wake up and smell the Kool-Aid. You’ve either been brainwashed or you’re personally threatened by the inevitable rise of comparison websites. Rather than reeling off these weak, age-old arguments, why don’t you have an honest think about what’s best for ‘every day middle-class Australians searching for a car insurance policy’. Can you honestly say it’s automatic renewal?! As Joshy said, surely it can only be a good thing that comparison websites are prompting Australians to take more of an active interest in their insurances. Admittedly this isn’t good news for insurers that have systematically ticked up the annual premium prices of their loyal customers, but I thought we were considering what’s best for consumers here?
  • Natalie | 13 Oct 2014, 10:40 AM Agree 0
    @Chris Well Said! "Wake up and smell the Kool-Aid" made my day.
  • Giles Thorman | 13 Oct 2014, 03:12 PM Agree 0
    I work in the Industry across the ditch and we also have a similar debate going on over here. A couple of points I would like to throw to the "every day middle class Australians" that seem to be the main instigators of this debate; In the event of a claim where the Insurer has a dispute with the policyholder, who advocates on behalf of the policyholder if you have used a website?

    We had a couple of very large earthquakes over here in 2010 and 2011 that led to one of the largest Insurance claims in the World in 2011. We had a company over here that competed directly to the market via the TV and papers etc on price; that was their mantra. How they came up with the premiums they did was a mystery to the rest of the Insurance market UNTIL the earthquakes when the Government had to bail them out for millions of tax payers dollars because they had taken far too little re-insurance and were over exposed to that particular market.

    @Chris and "Wake up and smell the Kool-aid" does not literally translate over here, however I think I just have enough brain to work it out. Sometimes the "General Public" can think that intermediaries/brokers do nothing but clip the ticket; my reaction would be that every Insurance Comparison website should have emblazoned in large prominent lettering "Caveat Emptor"
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