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UK Insurance Aggregators 2018

UK Insurance Aggregators 2018

Summary

The report UK Insurance Aggregators 2018, explores consumer purchasing behavior through price comparison sites and how it is changing. Percentage of consumers conducting research on price comparison websites at renewal increased in three of the four main personal lines, with travel insurance the only exception. This includes a rise of 4.5 percentage points (pp) in motor insurance, the biggest market for price comparison sites.

However, aggregators failed to increase their market share in purchases by channel in three of the four lines, with home insurance the exception. This is mainly due to the dominance of the direct channel, with insurers increasingly having more ways in which to engage and communicate directly with customers.

Critical success factors -

  • Better transparency: Aggregators need to provide consumers with greater confidence in their purchases by clarifying the information surrounding their policies.
  • Brand awareness and trust are key: Our 2017 UK Insurance Consumer Survey found that the main reason consumers chose a particular aggregator across all four lines was that they had purchased from them before and trusted them.
  • Individualizing the customer journey: Redesigning the initial application question set for quotes would help customers find products suited to their individual needs and requirements. One example is in the pet market, where three of the four aggregators ask for the pet’s name and use this information to personalize all questions.
Key findings include in this report -
  • Three of the four main aggregators reported an improved year-on-year financial performance.
  • Confused.com was the only one to launch a large-scale advertising campaign up to H1 2017, but Comparethemarket.com and Moneysupermarket.com released theirs later in the year.
  • Travel insurance has the highest percentage of customers who bought through price comparison sites at 50.7%.
The report furthermore helps in understandingwhat is most influential to customers when selecting a policy through the channel and reveals the brand strategies of the four leading sites. Their distinct approaches to advertising are also highlighted, as well as key factors that will influence the market over the coming years - including regulation and new technology.

Companies mentioned in this report: Moneysupermarket.com, Confused.com, Gocompare.com, Comparethemarket.com, BGL Group, Admiral Group, Competition and Markets Authority, Financial Conduct Authority, , Brolly, Guevara, Merlinio, CompareChecker, Insurethebox, Saga, LV=, Quotemehappy, General Accident, InsureWiser, homenet, quotelinedirect, computerquoteinsurance.com, InsureAndGo, Puffin, Virgin Money, CoverWise, e&l, Paws & Claws, Purely Pets, Perfect Pets, Amazon, Google.

Scope
  • Three of the four main aggregators reported an improved year-on-year financial performance.
  • Web traffic increased but dominance in individual channels declined as consumers opted to go direct to insurers.
  • Confused.com was the only aggregator to launch a large-scale campaign up to H1 2017, but Comparethemarket.com and Moneysupermarket.com released theirs later in the year.
Reasons to buy
  • Adapt your distribution strategy to ensure it still meets customer purchasing behaviors.
  • Ensure you remain competitive as new innovations revolutionize the consumer purchasing journey.
  • Be informed of how new technology could impact the aggregator channel over the next few years.
  • Read about differences in pricing between the top four comparison sites.


1. EXECUTIVE SUMMARY 2
1.1. Aggregator web traffic picks up as premiums soar 2
1.2. Key findings 2
1.3. Critical success factors 2
2. AGGREGATOR MARKET 7
2.1. Aggregators’ promise to save consumers time and money holds strong appeal 7
2.2. Aggregators are increasingly important as a research tool, but conversion rates are dropping 7
2.3. Financial results indicate a strong performance from aggregators 10
2.4. Price is essential, but consumers do look beyond the cheapest policy 12
2.5. The Insurance Distribution Directive aims to increase clarity 12
2.6. The FCA’s renewal transparency regulation has yet to be properly enforced 13
2.7. Advisory, concierge insurtech apps could mount a challenge to aggregators 13
3. COMPARISON SITES BY CHANNEL 15
3.1. Motor 15
3.1.1. Regulation 17
3.1.2. Future market and threats 18
3.1.3. Average price varies considerably across the leading aggregators 19
3.2. Home 21
3.2.1. Clarity remains an issue in improving the home sector 25
3.3. Travel 25
3.4. Pet 27
3.4.1. Soaring premiums are sending consumers to aggregators 27
3.4.2. Clarity remains a problem in the pet sector 30
4. COMPARISON SITE PROFILES 32
4.1. Overall 32
4.1.1. Comparethemarket.com offers the cheapest premiums 33
4.2. Comparethemarket.com 33
4.2.1. Comparethemarket.com is caught up in a CMA investigation 33
4.2.2. Comparethemarket.com released strong financial results 34
4.2.3. Comparethemarket.com is on the hunt for someone to travel the world 34
4.3. Moneysupermarket.com 34
4.3.1. Moneysupermarket.com enjoyed a strong start to 2017 34
4.3.2. Moneysupermarket.com leads the way in mobile apps 35
4.4. Confused.com 35
4.4.1. Confused.com sacrificed profit for a marketing push 35
4.4.2. Confused.com is continuing its James Corden-led advertising campaign 35
4.5. Gocompare.com 36
4.5.1. Solid financial performance for Gocompare.com 36
4.5.2. Gocompare.com look towards fintech 36
5. MARKETING 37
5.1. Overall 37
5.2. Confused.com dominates advertising spend 38
5.3. Moneysupermarket.com has increased its radio advertising 39
5.4. Gocompare.com’s advertising spend continues to decline 40
5.5. Comparethemarket.com spent less than £1m in H1 2017 41
6. Appendix 43
6.1. Abbreviations and acronyms 43
6.2. Definitions 43
6.2.1. Home insurance 43
6.2.2. Pet insurance 43
6.3. Methodology 43
6.3.1. GlobalData’s UK Insurance Consumer Surveys. 43
6.4. Bibliography 44
6.5. Further reading 44
List of Figures
Figure 1: Consumers increased their use of price comparison sites for research in 2017 8
Figure 2: With the exception of household insurance, purchases through comparison sites continue to fall 9
Figure 3: Converting consumers from research to sales is a growing issue for aggregators 10
Figure 4: Switching rates increased in motor, the largest insurance sector 11
Figure 5: A higher proportion of switchers are also using price comparison websites 11
Figure 6: Consumers look beyond the cheapest policy 12
Figure 7: Comparethemarket.com benefits from brand awareness 16
Figure 8: Motor premiums hit double-digit growth in H2 2017 17
Figure 9: Confused.com provides the cheapest options for motor customers 20
Figure 10: Customers turn to Confused.com for value and Comparethemarket.com for brand trust 22
Figure 11: Household premiums have been in steady decline despite a late 2017 rise 23
Figure 12: Comparethemarket.com offers the cheapest home insurance policies 24
Figure 13: Gocompare.com benefits from search engine usage and advertising 26
Figure 14: Travel premiums remain cheap and consistent 27
Figure 15: Moneysupermarket.com stands out on price in the pet market 28
Figure 16: Comparethemarket.com edges its competitors to offer the cheapest accident-only quotes 29
Figure 17: Confused.com offers the cheapest lifetime pet policies 30
Figure 18: Comparethemarket.com has a dominant lead across all four lines 32
Figure 19: Familiarity with brand is key for consumers 33
Figure 20: Advertising spending has been on the decline, with the exception of Confused.com 37
Figure 21: Confused.com spends the majority of its advertising budget on motor insurance 38
Figure 22: In H1 2017 Confused.com diversified its advertising spend 39
Figure 23: Moneysupermarket.com shifted away from TV in H1 2017 40
Figure 24: Gocompare.com increased its advertising expenditure in H1 2017 41
Figure 25: Comparethemarket.com kept its H1 2017 advertising spending to a minimum 42

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