Revealed: why comparison sites can cost you more

An article in The Sunday Times (20th June 2010) about insurance comparison sites is an interesting parallel to the online travel agent sites.

The article revealed how the consumer is often being misled by insurance comparison sites that claim to offer the best deals. It found that cheaper deals could be had by going direct to the insurer. An example cited was of a 49 year old man who saved £120 by going direct to Tesco rather than buying via Confused. Direct Line and Aviva are nowhere to be found on the comparison sites but as with the Tesco example, consumers can often find better products for less money with these companies.

A familiar theme also highlighted in the article is the emerging trend among comparison sites to raise their commission charges to the insurers. As with the online travel agents, this is no doubt to fund their ever increasing marketing costs as the comparison sites strive to out compete one another. Comparing prices is in theory great for the consumer but if the insurers succumb to the new charges, price rises will follow down the line.

If you’re a hotelier have you put your prices up to counter the increasing commission charges or are you simply making less money? Either way you could do the same as the insurers and welcome customers that come direct with the reward of cheaper prices. See our tips here and get listed on the zero commission direct booking accommodation portal.

Published on June 23rd, 2010 Uncategorized


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