Price-comparison websites could be providing their users with misleading information, the Financial Services Authority (FSA) has warned. The financial industry watchdog said it was concerned that the prices quoted on the sites for insurance products could be underestimates.
The websites act as an intermediary between the public and big firms, with users entering their details and the operators then sourcing quotes from a panel of insurers. These are usually sorted by price before being passed on to the user. But concerns have been raised in the past that important information is deliberately being left out to keep down the prices quoted. When users subsequently re-enter their details on the insurers' own websites, they will in many cases be quoted a higher figure.
As a result, the FSA has been monitoring 17 price-comparison sites. It has reported that a "mixed" picture has emerged regarding the clarity, fairness and accuracy of the information given to users.
The FSA now wants the websites to ensure they are consistent in the level of detail they give on different policies and that the information is correct and up to date. The regulator's officials will be visiting the sites to assess whether they are putting these recommendations into action.
Comparison sites are big business – generating, for example, an estimated 30 million individual motor insurance quotes in 2007 – and the industry is keen to protect itself against adverse publicity. Paul Baxter, from the recently launched Tescocompare.com, said clarity of detail should be a "core element" of price- comparison sites and added: "We fully support any steps the FSA may take to improve any current failings." Rival site Confused.com went further and said that it would welcome tougher regulatory action to ensure fair play.Reuse content