Comparison sites’ face-off raises questions of trust
Competition among comparison sites is growing as bullying allegations and credibility issues emerge. Simon Read reports
A battle is breaking out among price comparison sites after the mighty Moneysupermarket.com threatened a new rival with legal action.
Payingtoomuch.com published a table showing the cost of life cover at a variety of insurers and comparison sites, but was forced to remove Moneysupermarket from the list after received a threatening letter from the UK’s biggest aggregator.
“Our price check table includes quotes from all our major rivals, but only Moneysupermarket complained,” Payingtoomuch founder Mike Ward said. “It’s ironic that the largest comparison site in the UK doesn’t wish to be compared,” he said. “They’re happy for customers to compare from their chosen panel, but it seems they would prefer people not to compare widely beyond that.”
“We reserve the right to report your actions to the police,” the letter continued. Mr Ward, who previously worked in the life insurance industry, said: “I want to encouraging customers to shop around. Their letter is an example of Moneysupermarket using bullying and a legal loophole to shut down a comparison of their prices.”
“More importantly, the way it positioned the price check is not particularly transparent or independent, which is important to our customers. Pricing on life insurance is based on a whole range of factors, beyond the simple scenario which they have placed on the site.”
It is understandable that Moneysupermarket is getting touchy about its profitable business, as the internet giant Google has recently announced its own price comparison service through its search engine, offering credit cards, current and savings accounts, with further finances expected soon.
Google splashed out £37.7m on the UK agreggator beatthatquote.com last year, ahead of last month’s launch. But satisfaction with comparison sites is falling. Which? says three-quarters of its members don’t trust comparison sites.
Last month Which? Money discovered that many such sites search less than a third of the total market. For home insurance, for instance, Moneysupermarket searches 33 per cent of the total market but Confused.com covers just 19 per cent and Comparethemarket. com only 22 per cent.
“The traditional comparison sites have shot themselves in the foot by attracting people with low premiums which are then not matched by the provider,” Mr Ward said. “It means they’ve lost credibility.”
But Mr Donoghue pointed out that price comparison had revolutionised the way people bought financial products. “Remember how it used to be for consumers before comparison was available? Time consuming and difficult to find the best deal,” he said.
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