which_quoteIn an earlier Blog Post we discussed the topic “What is an Insurance Aggregator?” We have identified this medium to acquire an insurance quote as a fast growing alternative to the traditional broker and an easy and fast search utility to gain comparative quotes.

But what are the possible benefits as well as the pitfalls with regards to insurance aggregators? Will it help me to gain not only a speedy and cheap quote – but indeed the best quote?

The advantages are easy to find. The search aggregator is marketed as easy to use, convenient and fast! Consumers only have to enter their details once on a quote request – this removes the time – consuming task of completing pages and pages of online forms from different insurers. The results are also available within minutes.

The consumer would be well advised to also acquaint himself with the criticism towards insurance aggregators. Some critics believe that insurance aggregators do not address all the criteria of an insurance quote. These criteria are quality, service and price – and they say that the insurance aggregator only addresses price. As insurers in this highly competitive market look at ways to offer cheaper prices through aggregators they offer “stripped down or basic policies” which might neglect many other important insurance needs.

Insurance aggregators have also been described as “price comparison sites” which are not much different from being middlemen giving indicative pricing – similar to the broker but only in an electronic/internet medium. Critics have expressed concern that there might be inaccuracies in pricing and that the premium quoted can be wildly different from that generated by the aggregator site, who would have prepared the quote based on some default or pre-completed answers.

In defence of the Insurance aggregator we may point out that much of the criticism is addressed in some of the disclaimers on aggregator websites. I would like to quote from one of these disclaimers:

“The quotes are therefore only illustrative and not a binding offer. The quotes are subject to change, based upon the verification and further consideration of more comprehensive risk related information that you will be required to disclose, when you agree to the insurer or broker contacting you.”

It is important to consider and understand the weaknesses of the insurance aggregators. The consumers need to understand that insurance aggregators will not actually compare the whole insurance market, but will provide accurate pricing of those insurers that have concluded agreements with the aggregator to provide quotes.

For more comprehensive risk related quotes the consumer would have to consult and negotiate with the insurer and his representative directly. Insurance aggregators are here to stay and expected to play an even more important role in the insurance industry in year to come. The consumer would however be well advised not only to rely on the ease and speed of gaining a quote – but to approach any financial product with caution and a bit of extra consideration!

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