Car Insurance quotes: be careful about using price comparison sites

Price comparison sites have sprung up everywhere on the net, nowhere more so than in the world of Insurance and particularly car insurance which is mandatory to buy if you drive a car. The benefit of these online insurance quotes sites is that they are a sort of one-stop shop where you plug in your details and get served up a cheap quote from a database of insurance companies.

But can you trust the insurance price comparison sites? Do they really save you money?

How price comparison sites work

They ask you to put in your personal details (date of birth, gender, the type of car etc) and they then churn through their database looking for a quote, and serve up the cheapest car insurance quotes.

The hope is that once you have found your cheap quote, you click through to the insurer concerned and purchase, and the insurer will provide the price comparison site with a commission for introducing you - usually about £40-£50 each time.

The drawbacks of price comparison sites

They arn't really impartial, though they make a great play of saying "we don't have adverts on our site". They don't need adverts (which pay peanuts), when they get commission for introducing buyers to the insurance companies! In addition the "best sellers" list tend to actually be sponsored by the insurers - i.e. the insurer has paid to be listed.

Further, many are owned by the insurance companies themselves (eg Confused.com is owned by Admiral insurance), which is a potential conflict of interest.

The worst crime of all is that their database is often incomplete - for instance none of the price comparison sites in the UK list Direct Line Insurance, which is the market leading provder of car insurance, and often cheaper than all the other insurers. The reason Direct Line is omitted is that they don't provide commission to the price comparison sites. Insurance giant Norwich Union (Aviva) is also omitted for the same reason.

There is also such a plethora of sites - moneysupermarket.com, TescoCompare, Gocompare, that you often need to have a guide to which price comparison site works best. (In my personal experience Tesco Compare has the most insurers on it's database, though it still doesn't have Direct Line on it's list).

One final drawback from a personal privacy point of view is that some sites e.g. Confused.com ask you to register with them before they can provide you with a quote.

What you should do

There is nothing wrong with using price comparison sites to search for quotes as long as you are aware that they are incomplete.

The best thing to do is to Google for a list of car insurers, print the list out and then check to see if the price comparison sites have them in their database (when using Confused.com for instance, you can go to their list of insurers to see who is included). Mark on your list the insurers that have been omitted and be sure to visit their sites directly to see what kind of quote they can offer. Also check the main newspaper sites for listings of insurers. Yes, it will take a little longer, but you could potentially save yourself a lot of money by broadening your search.

Keep an eye on the mainstream press for special offers from the insurers too.

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