The role of online comparison sites as a force for good in 2020 and beyond

In 2002, Confused.com was born. We were the first insurance comparison site to market and pioneered a movement that has delivered significant change to the industry. We transformed an overcomplicated customer experience into a quick and easy process; providing a range of products that meet people’s changing needs, all while saving insurers billions of pounds in advertising costs.

But it’s the enabling of a transparent, healthy and competitive market and its impact on customers that really motivates us and gets us out of bed each morning.

I always come back to the image of David versus Goliath because it resonates deeply with me – and goes right to the heart of Confused.com’s purpose.

It all comes down to a rebalancing of power. As I see it, we help David stand up to Goliath. Why? Because as consumers, we can often feel helpless when facing up to powerful institutions: financial services providers, insurers, utility companies and so on. Confused.com levels the playing field by empowering individuals to choose better.

We have always existed to rewrite the power dynamic between institutions and customers and protect people – and this principle rings truer today than ever. Put simply, online comparison sites are a force for good because we enable competition and make it easier for people to shop around, find the right product and save money.

This year has been an incredibly challenging one. The magnitude of the recession caused by the coronavirus outbreak is unprecedented in modern times and the UK economy could be among the worst hit of leading nations, according to the OECD[1].

Now more than ever, people want to be fiscally prudent and save money. Shopping around for the best deals to reduce household outgoings is incredibly important, especially for the most financially vulnerable. As such, we have seen a rise in the number of customers coming to Confused.com since the beginning of the pandemic outbreak.

Yet the enduring value of online comparison sites was called into question in September by media and commentators when the FCA proposed new rules on the way insurers price their products. The changes include a ban on price walking – the practice of automatically renewing and increasing premiums for existing customers over time so loyal clients often end up paying much more than new ones. Under the proposed rules, you will not be charged more as a renewal customer than you would if you came to that insurer as an existing customer and you will be able to opt out of being automatically renewed at any time, through any means.

If the loyalty penalty disappeared, suggestions were made that there’s less incentive for people to shop around for their cover. This simply isn’t true.

Having a view of the whole market is critically important, because 80% of the time, your incumbent insurer isn’t the cheapest option for you. So customers still need to shop around. In the future, when they see a saving, the new rules will make it easier to switch.

Changing insurance providers is often a huge pain point for customers. Cancelling your policy should be as easy as buying your policy, yet some current structures are designed to frustrate customers’ intentions to cancel. Incumbent insurers naturally launch into a ‘save the sale’ process and even though it was not the customers’ plan half the time, they often succeed. This is clearly not what the FCA has in mind when it comes to treating customers fairly and we welcome their decision to regulate in favour of the customer to stop this happening in the future.

As a comparison industry, it is important that we practice what we preach. If you are not truly on the side of the customer, you will be found out and you will lose out to the competition. Our belief at Confused.com is that if you act in the interest of customers you may lose out commercially in the short term but more importantly in the long run, your customers will win – and therefore so will you.  

Our core value is that customers are king. This means that we’re focusing beyond the ‘research and decision making’ part of the process and towards delivering greater product innovation and more value-creation for customers.

In simple terms, this means that we’re filling out the shelves of our supermarket to help customers in more aspects of their lives. We have always been driven by a commitment to protect customers, turning confusion into clarity and delivering meaningful value to people – and we look forward to doing even more of this in the years to come.

[1] https://www.bbc.co.uk/news/business-52991913