Saving time and pennies
Editor, Which? Money
On price comparison sites advantages
Martyn Hocking: There’s no doubt that price comparison websites can save you time when you’re looking for a loan, a credit card, insurance. The question is how much money they can save and how much you as a consumer still need to do to make sure you’re getting the best products. If you only visited one site for example, and you were in a hurry, you would almost certainly not be getting the best price. We would always say even with price comparison websites you still need to shop around.
On their benefits
Martyn Hocking: I think there’s no doubt that what they do is save you a huge amount of time. If you think back a few years, the alternative might have been phoning round loads of individual companies to get quotes, and even if you’re on the internet where do you start. So there is certainly a service there, those sites do save you time. It’s a question, though, of how much money they save you.
On market share
Martyn Hocking: All the sites present themselves in a very similar way, and I think you could be forgiven for assuming that a) they all have the same amount of coverage, and b) they have virtually every insurer in Britain on their site. In reality some of the biggest insurers and some of the best deals from companies like Direct Line are not on any of these sites. So again, if you’re only going to one site you’re almost certainly not getting best value for money.
On secured and unsecured loans
Martyn Hocking: I think most people would assume that if they’re taking out a loan it would be an unsecured loan that would be featured on the results page of a comparison website. What we actually found is that some of the cheapest deals were secured loans. Now that means they are secured on your house and if you fail to keep up payments your ownership of that house is at risk. Now at any time that would be worrying but, particularly when the property market is in such a state of flux, we really think that that’s unacceptable.
On site transparency
Martyn Hocking: There is a particular issue here. When you get to the results of a price comparison website, I guess you think the hard work’s been done, you’ve put all the information in and you’re now looking at an unadulterated list of the best value deals. However, certainly on one of the sites, what you’re looking at at the top of the page are a series of sponsored links. Now those aren’t necessarily the cheapest deals, they’re deals which are attractive commercially to the website provider. If you’ve got the time, if you scroll down you will find the cheapest deals on that site, if you’re in a hurry and you simply click the top link you may actually not be getting the best deal at all.
On ease of use
Martyn Hocking: I think clarity is a very serious problem. These websites sell themselves on the fact that they are very quick and easy to use, but the Financial Services Authority have made a particular point, they do need to be clearer, they do need to be easier to use for consumers, and this sort of issue, having secured loans where you think you’re looking at unsecured ones, having sponsored links where you think you’re simply looking at the cheapest deals really suggests to me that there is a lot more work for these sites to do if they want to improve clarity for consumers.
This video extra has been produced for Price Comparison Sites: Deal or No Deal which was broadcast on Friday 5th December at 19:00 on BBC TWO.
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