12 Things You Need To Know About Comparison Sites

As consumers we are always on the lookout for the best deal; the cheapest holiday, buy-one-get-one-free offers on our groceries, and vouchers for money off everything from a meal out to a bikini wax. So when it comes to financial products such as insurance, credit cards and loans, it’s no wonder that so many of us turn to price comparison sites in an attempt to get them for the lowest possible price. But how do they work exactly, and are they always the best way to get a great deal?

1.) What Is A Price Comparison Site?

Put simply; a website that compares the prices of similar products or services, with the most well known ones being for things such as insurance policies (we’re looking at you, Russian Meerkats).

These websites allow you to get quotes from a variety of firms within the same market all in one go, meaning you don’t have to fill in loads of forms from loads of different companies in order to find out who is cheapest.

2.) How To Use Them Effectively

Price comparison sites tend to work in one of two ways, depending on what service or product it is you’re after. By either:

Allowing you to search for a products via a ‘best buy’ table
Asking you questions and for your personal details in order to give you personalised results

Personal loans and credit cards can be compared quickly on screen, whereas with something like car, home, or travel insurance you would need to disclose more information, because the price of these products will depend on your individual circumstances. For example, an insurance company will need to know details about your home and belongings to give you an accurate quote, and you’ll need details about your journey and your medical history if you are in the market for travel insurance.

3.) Use More Than One Site

No price comparison site has ALL the products in EVERY category, so it’s a good idea to search several websites before you buy. You also need to be aware that some financial product providers aren’t featured on price comparison sites – in fact for some, such as Direct Line, it has become part of their marketing spiel. In order to get quotes from companies that don’t subscribe to price comparison sites you’ll have to contact them directly. Sometimes you’ll find these have cheaper deals, so it’s worth putting in the extra effort.

4.) Double-Check The Details

Things such as the amount of excess you set for an insurance policy or choosing whether to pay your premiums monthly or annually could have a big impact on the quote you’re given, so always check that you’ve given the appropriate details. It’s always worth knowing that if you can afford to pay for an insurance policy in one lump sum, or you’re happy to increase your excess you could be offered a better deal.

5.) Quality Vs Cost

The whole point of a price comparison website is to find you the cheapest deal – but this doesn’t always mean that it is a product that provides the level of cover you need. Low-cost insurance policies are unlikely to include perks, for example; a car insurance policy that provides a hire car in the event of an accident.

Focus on value for money rather than just the cheapest deal, as those little extra benefits could be well worth paying a bit more for!

6.) What To Look Out For

On the surface of things price comparison sites are great – they’re certainly a good starting point for seeing what products are out there and how much for. You don’t have to make any appointments or speak to anyone over the phone, it’s quick and easy, and you could do it sitting in your pyjamas at 2am while eating a kebab if you felt like it.

However, there are some things to beware of….

7.) You’re’ Flying Solo

The number one thing that people love about price comparison sites, ie: that you are left to your own devices, is also the number one disadvantage in my opinion: you are left to your own devices. Forget the convenience of being able to shop for insurance while you’re in the bath for a second and really think about it. You will be deciding to buy a product with no professional advice or guidance whatsoever, and it can be so easy to choose the wrong company or buy the wrong product for your needs and end up out of pocket. Worse still, you are responsible for setting up the policy yourself and if you don’t do it correctly it might not pay out when you need it.

8.) You Might Not Be Given The True Price

Often on price comparison sites the prices listed are actually ‘pre-application’ prices, and once you’ve actually applied with the insurance company you’ll discover that after disclosing certain information, the price or terms originally offered change. This means that unless you were to fill in applications for every single insurer listed you won’t know who is the cheapest.

9.) They Might Make Assumptions

Price comparison sites will often make certain assumptions about your circumstances, so it’s important that you check very carefully when filling in applications. For example, there could be a pre-ticked box stating that you have no criminal convictions – a fair assumption to make for the vast majority of the insurance-buying public – but, if you have been breaking bad and you don’t un-tick that box yourself, you could end up buying a policy that won’t pay out when you need it to.

10.) Check The Excess

The higher your excess, the lower your premiums, and price comparison sites will automatically set the excess high to make the rates you see look really cheap. You might be thinking, what’s the problem with that? The cheaper the premiums, the better! Well yes, until the time comes that you want to make a claim, and realise you can’t afford the excess. Price comparison websites don’t tend to ask for your excess preferences until the results page has popped up – and sometimes not even then! – so double check you don’t buy a product based on cheap premiums only to get lumbered with an excess you didn’t want or can’t afford.

11.) Annual Or Monthly Payments

There’s a big difference price-wise between paying monthly and annually; for example, paying monthly on your home insurance instead of annually can be more expensive, and so the cheapest annual-payment policies aren’t necessarily the cheapest when it comes to monthly premiums. Price comparison sites will sometimes rank insurance policies on their annual cost, even if you want to pay monthly.

12.) Free Extras Don’t Always Stay Free

There can be some great free perks to be had with some insurance policies, and there are some added extras that can really make an insurer stand out and convince you to seal the deal. However, some policies offer add-ons that are free for a year, and then automatically renew – at a cost – unless you specifically cancel. There are even some examples of sites automatically adding on paid-for extras! You can remove add-ons by visiting the insurers website, so it’s not the end of the world, but just be aware that you might be getting more than you bargained for so it’s best to always check that you’re only getting what you want.

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Luke

Luke

I’m the Life & Critical Insurance guy! Having worked throughout London and the South East for years in this industry, seeing many bad habits, I wanted to create a company that put the man on the street first! I wanted to share all my knowledge in a way that was easy, simple and fun to read and I wanted to make sure whenever I or a member of my team speak to a customer, we cut out the ‘industry jargon’ and never pressure or push anyone to take out a policy they don’t want or understand, thus More Than Money was born!

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