Aggregator market to shrink within three years - Beachcroft

Most aggregators will dissolve or consolidate over the next three years, leaving a handful of big players, according to a new report issued by solicitors Beachcroft.

The commercial law firm’s report 'Learning to live with the Aggregator' predicts that aggregators are here to stay, but that they will look very different.

A survey of big market players about the relationship between insurers and price comparison websites found a strong belief that most aggregators will eventually either dissolve or consolidate, leaving a small handful of aggregators with both sufficient economies of scale to survive and the spending power to support their brands.

The report also warns that aggregators and insurers should be more willing to share data about actual and potential customers, both to cut fraud and identify additional opportunities.

David Pollitt, partner and head of the Financial Institutions Group at Beachcroft, said: "The insurance market is a fiercely fought battle ground and it's interesting to see how the relationship between aggregators and insurers is still a long way from being fully cemented.

"It's clear that there is potential for insurers and brokers to get much more out of their relationships with aggregators, and although this will present some danger areas for both parties, they should not allow this to deter them.”

The report highlights a number of issues that insurers and brokers need to tackle if they are to get more out of their relationship, including getting greater clarity and control over customer ownership