The financial regulator has found that some general insurance price comparison websites (PCW) are not meeting consumers’ expectations.
In some cases, regulatory standards are not being met either, according to the Financial Conduct Authority (FCA).
These were the findings of a review carried out by the FCA which looked at 14 price comparison websites and included in-depth consumer research with 50 participants.
The FCA is particularly concerned that consumers focus on headline price and brand when using PCWs, which could distract them from crucial product features such as policy coverage and terms.
By failing to provide clear information, the websites are increasing the risk that consumers may buy products without understanding key features, such as level of cover or excess levels and purely focus on the price. While a few websites did provide this information clearly the level of clarity varied significantly depending on the provider.
Clive Adamson, FCA director of supervision said: “Price comparison websites have increased in popularity among consumers with an estimated one third of consumers buying their motor insurance policy through them.
“However, our review found that they were not meeting our requirements in delivering fair and consistent outcomes for consumers. We also found, through our consumer research, that consumers had a number of misconceptions about the services they provided.
“It is also important for consumers to understand that not all products are the same and the cheapest product may not always be the best for their needs.”
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