UK Insurance Aggregators 2015
Insurance aggregators have become a popular means of product distribution with a particular significance in the personal insurance market, although in recent years the channel has expanded into commercial lines. Currently, there are four aggregators that cater to a large proportion of the insurance market (known as the Big Four).
Reasons To Buy
- Examines the introduction of new market legislation and how aggregators will respond.
- Provides an overview of the investments made by aggregators in advertising and marketing.
- Analyzes the use of technology and the new digital initiatives aggregators are looking to employ.
- Which insurance policies are being bought via aggregators?
- How will the introduction of new legislation affect the aggregator market?
- How can technology improve the customer experience when using aggregators?
Currently, the Big Four's insurance products have little differentiation from each other, particularly in the car insurance market. This is due to the exclusivity agreements they have signed with insurers, which prevent their products from being offered at a cheaper rate elsewhere.
The aggregator market model has experienced little change since its earliest days and has fallen behind other areas of finance in terms of servicing and retaining the customer; for example, aggregators can do more to make use of the new technological facilities that are now available.
Wide most favored nation clauses are considered to be the most damaging to the market as they absolutely limit market entry, prevent product innovation, and restrict price differentiation. This results in higher premiums for consumers because it is not possible for competing insurers to offer lower prices in order to gain market share.
- Executive Summary
- Regulatory changes will encourage insurers to revise their product offerings on aggregator sites
- Key findings
- Critical success factors
- The Aggregator Market
- Consumers look to aggregators first before buying insurance
- Car insurance is the most sought-after insurance product on aggregators
- New legislation is set to change the relationship between private motor insurers and aggregators
- Wide MFN contract clauses are preventing insurers from offering their products at a cheaper rate in other online channels, resulting in higher premiums
- Table The cost of annual shoparound average motor premiums is decreasing
- The banning of wide MFN contract clauses will facilitate competition in the private motor insurance market
- Aggregators are not providing sufficient information regarding add-ons
- Will providing more product information increase or reduce competition in the aggregator market?
- Marketing and the Major Aggregators
- Comparethemarket.com is beginning to diversify its advertising
- Comparethemarket.com is considering the relaunch of two-for-one cinema tickets
- Gocompare.com continues to spend big on advertising
- Gocompare.com adopts a new approach to advertising with the launch of a brand new campaign
- Television is the preferred advertising medium for Moneysupermarket.com
- Moneysupermarket.com has kept with tradition and launched another "Epic" ad
- Confused.com's advertising leaves consumers feeling, confused
- Confused.com looks to engage consumers with the launch of Brian the Robot
- The proliferation of internet technologies is another contributing factor to the success of the Big Four
- Insurance Aggregators in the Digital Age
- Aggregators need to embrace the tech-factor to both grow and maintain their market share
- Aggregators need to ensure they can accommodate the increasing number of consumers adopting smart devices and using mobile applications
- The aggregator mobile apps that are currently in use are basic and product-specific
- Keeping the customer coming back is imperative as technology increases shoparound tendencies
- Confused.com will be the first aggregator to introduce new fraud detection technologies
- The Aggregator Market Going Forward
- Technology investments can help aggregators expand their services and enhance their propositions
- The customer must remain at the heart of all new developments
- Abbreviations and acronyms
- Primary Sources
- Secondary Sources
- Further reading