The issue was raised first time back in 2005. Back then the financial watchdog decided against on taking any action based on the given evidence. However, new evidence surfaced by a recently conducted research commissioned by the British Insurance Brokers’ Association, BIBA, led FSA to re-examine the rules governing insurance comparing websites.The research revealed that more than 50% of the consumer sample who had used price comparison websites felt the differences between insurance policies were not adequately explained while only a 6% felt sufficient informed on all the policies' parametres. This intransparency could potentially lead customers decided upon unsuitable products.
BIBA chief executive Eric Galbraith claims "There are still too many people logging on and making a decision solely based on the price of a policy, rather than the protections it offers them and potentially buying an inappropriate policy." "I believe the regulator should now look again at developing more appropriate regulations, to ensure that consumers are being afforded suitable protections," he added.
Reactions vary amongst main market rivals. The insurance comparison site http://www.confused.com/ supports BIBA’s request for further scrutiny voluntarily inviting FSA to regulate its activities. On the other hand http://www.gocompare.com/ rejected BIBA’s complaints condemning them as outdated. The other rival http://www.moneysupermarket.com/, fully authorised by the FSA, welcomed new FAS guidance the same time though accused BIBA for inflating the issue.
Pretty confusing, isn't it?
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