Broker trade body welcomes regulator's call for prompt action to be taken by comparison websites.
The British Insurance Brokers’ Association (BIBA) has welcomed the Financial Services Authority’s (FSA) review of insurance comparison websites and supported its call for the industry to take prompt action to provide consumers with clear information on excesses and assumptions.
BIBA believes that if urgent action is not taken then the FSA must outlaw assumptions and force aggregators to provide clear information about the total excess.
Steve White, BIBA’s head of compliance and training, said: “We will be watching closely to see that price comparison websites address the FSA’s concerns, and if not, will be calling for a number of their practices to be outlawed.”
BIBA’s demand follows its research from January 2008, which demonstrated serious consumer detriment with many insurance comparison websites and prompted the FSA review. In particular, the research showed that 84% of insurance buyers said that the details of insurance policies offered via price comparison websites can be confusing.
Graeme Trudgill, BIBA’s technical and corporate affairs executive, said: “The FSA’s review is a step in the right direction to greater consumer protection. Price comparison sites should implement these changes immediately. Ultimately we feel the best solution is for quotes to be guaranteed and assumptions outlawed.”
Eric Galbraith, BIBA chief executive, added: “I am delighted the FSA has acknowledged that consumers should compare insurance cover and not just focus on price alone. Insurance is complex and a broker is able to advise on the most suitable policy and not just the cheapest which may be unsuitable.”
BIBA is calling for:
- Excesses to be clear, fair and not misleading, for each section and the overall total
- Prevention of the misleading impression that consumers could make large savings
- Assumptions to be reasonable and clearly highlighted to the customer
- Comparison sites to guarantee their quotations
