Aggregators’ “frenzied competition” under fire

Aggregators’ “frenzied competition” under fire | Insurance Business

Aggregators’ “frenzied competition” under fire

An Austbrokers boss has become the latest to question the usefulness of aggregators and whether the customer is actually better off.

Earlier this week insurance price comparison site iSelect was forced to defend its commission structure when major health insurer Medibank Private claimed aggregators did little to improve customer affordability. Medibank’s managing director George Savvides said “In fact, I’d argue they’re adding costs because of the commission.”

However, aggregator iSelect, which is said to be listing soon, defended its business model.

CEO Matt McCann said:  “Our incentive is for when a consumer is well advised about a product that’s right for them, they should stay in that product.”

Listed Austbroker’s general manager of acquisitions and development, Fabian Pasquini, told Insurance Business that the bigger question was if the customer was receiving value for money.

“An aggregator brings together players in the market to create frenzied competition. It might be the case that it provides cheaper policies for the consumer but is it actually the best for the customer?

“When it comes down to claims, how much is covered? The aggregator may not provide the sort of help and advice brokers do.”