Car cover on the superhighway

Insurance firms are gearing up to sell cut-price policies on the Internet, writes Paul Gosling

Motorists can cut as much as 15 per cent off the cost of car insurance by using the Internet to buy their policy. Eagle Star Direct has launched what it claims is the first fully interactive car insurance- selling operation on the Web.

Internet selling is an extension of the existing phone-based direct selling services from several of the major insurers. Eagle Star is offering a 15 per cent discount to car owners for buying on the Internet, reflecting the lower costs involved, on top of its standard discount of 10 per cent for paying by credit or debit card. Home and travel insurance products are set to follow.

"We said we would wait to see the response before deciding whether to launch other products, but the indications are that it is successful," says Andrew Baud, an Eagle Star spokesman. "Within two weeks we had issued 15,000 quotations, and those were not to people idly surfing [browsing on the Internet]. We had sales of policies in the low hundreds."

Several other insurers are about to launch similar cut-price products. Guardian Royal Exchange already offers cover for home computers through the Internet, while many other companies have sites for promoting products, inviting browsers to leave personal details so quotes can be dispatched by post. A survey by Ernst & Young, the accountancy firm, found that 71 per cent of financial services companies, including insurers, intend to sell their services over the Internet.

Lack of security is often blamed for the slowness in the take-off of Internet commerce, but these problems are being overcome. The quality of encryption - the code used to disguise transmitted information - is about to improve, and this should reassure most consumers. The problem has, in any case, been overstated. People who give their credit card details over the phone, say for theatre bookings or to order goods, are as vulnerable to fraud as those who quote their numbers on the Internet.

A more realistic concern is the growing number of Internet sites that claim to offer investment opportunities; many of these are scams. The Securities and Investments Board (SIB) last month issued a warning about the growing incidence of confidence tricksters setting up copycat sites on the Worldwide Web. These dummy sites copy the logos of legitimate companies but introduce false information, including fake Web addresses and phone numbers. Similar names can cause confusion: the title Global Asset Management, for example, is being used not only by the London fund manager but also by a Ghana-based company.

SIB warns investors to be aware that anything that looks too good to be true probably is. Potential investors should check Web addresses and phone numbers to see whether they "look wrong". Even legitimate investment operations based overseas are best avoided unless the investor is aware of the regulatory system the deal will be subject to, and what their rights would be were anything to go wrong.

"Pyramid selling" frauds are frequently transmitted by e-mail. These are akin to chain letters, except that each person who joins has to pay someone higher on the list a sum of money - perhaps pounds 10 - on the promise that several times this amount will be paid out to each participant. Inevitably the schemes collapse, leaving later joiners out of pocket.

But used wisely the Internet can save money, as the Eagle Star initiative shows. Search engines - software programs that search out the cheapest prices for standard goods such as computer accessories, CDs and books - offer the potential for massive savings. These are in growing use in the US - look at the "www.shopbot.com" site to see how they work - and will soon be a common feature of Internet trade here. It may not be long before British consumers become as familiar with the Internet as they are with the telephone.

q Addresses to look out for on the Internet: "www.eaglestardirect.co.uk; "www.nationwide.co.uk" - an award-winning site that allows users to apply for services, including savings accounts, home insurance, credit cards and mortgages; "www.barclay- square.co.uk" - an Internet shopping mall that sells Barclays' services and gives access to Sainsbury's, Royal Sun Alliance, Argos and other home-shopping sites; "www.gre.co.uk" - Guardian Royal Exchange's site which offers computer insurance and plans to offer other insurance products; "www.esi.co.uk" - Electronic Share Information's award-winning site for a selection of share prices and share management services; "sale.cddirect. co.uk" - direct selling of computer CDs (ie not music); "www.independent.co.uk" - the Independent and Independent on Sunday can be read on-line.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
Finacial products from our partners
Property search
The programme was a look back at the Mad Men-y age of the Sixties and Seventies

Women born in 1950s facing severe financial hardship over pensions could have fates changed by Ros Altmann - should she choose to help

Women born in 1950s facing severe financial hardship over pensions could have fates changed by Ros Altmann - should she choose to help

PPI complaints were down by about a half

Banks face fresh wave of PPI compensation claims after landmark ruling

The PPI scandal has already cost Britain’s banks around £24 billion

Some experts warn that the bond sell-off may continue until the autumn, when the US Federal Reserve is expected to lift interest rates

Is it really that bad in the bond market?

The great sell-off has sparked fears for our pensions as well as bonds. Simon Read asks if you should keep calm or panic
Up and away: rates will rise but your mortgage won't escape its moorings with a long-term fix

Is a 10 year mortgage deal a fix too far?

A cut-price deal for a decade-long home loan - where's the problem? Only, says Simon Read, that circumstances can change and it won't be easy to get out
In a surprise move the Tories have decided against putting a career politician into the job. Instead they’ve handed the responsibility to campaigner Ros Altmann

New pensions minister has massive job on her hands

The Tories have appointed campaigner Ros Altmann to the post

Promises, promises: David Cameron talks to staff at Asda's head office in Leeds today

General Election 2015: How you vote next week could affect your finances

Rival party pledges could shrink your savings or grow your nest egg
Logos for the 'Big Six'; energy companies (top row from left) British Gas, EDF, RWE npower, (bottom row from left) SSE, E.ON and ScottishPower

Winter heating underpayment brings summer pain

One reader’s monthly direct debit charge has been increased by 62 per cent

Almost 15,000 people died last winter through living in cold homes that they couldn’t afford to heat

Social tenants locked into energy tariff for 40 years

Many Londoners who live in social housing estates are not allowed to switch because their landlord has ‘locked’ them in to buying from one supplier

Will your credit card rewards be scrapped following new EU rules on charges?

Providers are unhappy with new EU rules - but ultimately it is customers who will have to foot the bill
There remain more than a million unclaimed Premium Bond prizes worth collectively around £48m

Have you won £1m in the May Premium Bonds draw?

More than £60m was paid out to more than 2 million prizewinners this month

The 0 per cent introductory deals that credit cards offer are one of the most odious tricks

Beware credit card firms’ odious tricks

Why can’t we just have open and honest charges, without all the cross-subsiding?

The pound’s recent strength against the euro could be hit by economic uncertainty under a new government

How planning can make your travel cash go further

With the pound at a high against the euro, it pays to buy now before uncertainty post-election

Put the phone down on the coldcallers who see pension liberation as an opportunity to liberate your pension from you

Pension freedoms: How to deal with cold calls from scammers

Sean O'Grady offers advice on keeping your money safe
Switching to a better bank account is much easier than it used to be

More people are switching current accounts – but what do the figures mean?

Experts disagree about the 7% increase over the past year

The chance of getting what appears to be free money can be hugely attractive, especially to first-time buyers who can be fooled into thinking it’s extra cash to buy the essential new items they need for their dream home.

Beware the boom in cashback mortgage deals

Too many mortgages are being sold with misleading gimmicks

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Digital Optimisation Executive - Marketing

    £30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

    Recruitment Genius: Financial Reporting Manager

    £70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

    Recruitment Genius: Payments Operations Assistant

    £23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

    Recruitment Genius: Telephone Debt Negotiator

    £13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

    Day In a Page

    On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

    On your feet!

    Spending half the day standing 'reduces risk of heart attacks and cancer'
    Liverpool close in on Milner signing

    Liverpool close in on Milner signing

    Reds baulk at Christian Benteke £32.5m release clause
    With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

    The big NHS question

    Why are there so few new GPs when so many want to study medicine?
    Big knickers are back: Thongs ain't what they used to be

    Thongs ain't what they used to be

    Big knickers are back
    Thurston Moore interview

    Thurston Moore interview

    On living in London, Sonic Youth and musical memoirs
    In full bloom

    In full bloom

    Floral print womenswear
    From leading man to Elephant Man, Bradley Cooper is terrific

    From leading man to Elephant Man

    Bradley Cooper is terrific
    In this the person to restore our trust in the banks?

    In this the person to restore our trust in the banks?

    Dame Colette Bowe - interview
    When do the creative juices dry up?

    When do the creative juices dry up?

    David Lodge thinks he knows
    The 'Cher moment' happening across fashion just now

    Fashion's Cher moment

    Ageing beauty will always be more classy than all that booty
    Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

    Health fears over school cancer jab

    Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
    Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

    'I forgive everyone, but I don't forget'

    Fifa president Sepp Blatter issues defiant warning to opponents
    Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

    Weather warning

    Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
    LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

    High hopes for LSD

    Meet the volunteer users helping to see if it cures depression and addiction
    German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

    Saving Private Brandt

    A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral