Defaqto’s sixth annual home insurance report “UK Home Insurance – Aggregation or aggravation?” comes to some pretty damning conclusions as to the quality of home insurance aggregator sites.
The report looks at the problems that consumers face when purchasing home insurance through such sites, based on detailed analysis of the services offered by 28 aggregators including Comparethemarket, Confused.com GoCompare, Moneysupermarket and Tesco Compare.
Defaqto concludes that only five of these sites merit the title ‘aggregator,’ but is unable to recommend any of them for providing true ‘whole-of-market’ coverage, despite the bold claims many of them make about their breadth of coverage.
A further criticism is that few sites allow customers to compare policies on anything other than price. Even worse is the fact that some sites make a number of dangerous assumptions about underwriting factors in order to obtain quotations.
These include assumptions as to occupancy periods (that the property won’t be unoccupied for more than 14 days|), type of construction (conventional brick), the nature of usage (permanent residence, not a holiday home) and that the property has not suffered from flooding.
If these assumptions are not correct, they could invalidate the policy, so customers need to check the eventual quotation from the insurer extremely carefully. Other sites do not allow you to cover all your insurance needs, such as cover for “possessions outside the home.”
Excesses should also be checked as they may be higher in practice than those originally quoted online.
Defaqto general insurance consultant, Mike Powell, says: “The home insurance aggregation market is no where near as developed as the car insurance market….Our research into this market has left us with the opinion that there are only five true aggregator sites. The remainder predominently provide quotations from intermediary panels, which could easily be obtained from a local broker.”
Brian Brown, head of the Defaqto Insight team, says that aggregator sites can play a useful role in giving consumers an indication of what they might pay, but that they need to check with the provider’s site as to the exact terms and conditions of the policy.
So you need to check that the assumptions made are correct, particularly those regarding job title, occupancy levels, type of property, flood risk and claims history.
“The onus is on the consumer to check that all the details the insurer holds are correct,” says Brown.
By contrast, the Defaqto buildings and contents insurance comparison tools allow you to compare policies based on cover, rather than price.
Visit: http://www.defaqto.com/consumer/insurance/home/compare-buildings.aspx
http://www.defaqto.com/consumer/insurance/home/compare-contents.aspx
http://www.defaqto.com/consumer/insurance/home/compare-high-net-worth.aspx
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