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See you later aggregator

Aggregator services have changed the face of insurance in the past few years. Brands such as moneysuper-market and have become familiar to buyers of car or home insurance and some have branched out into other financial areas, such as life insurance and critical-illness cover.

Uswitch recently added life insurance to its insurance, utility and phone comparison service.

Some services have been criticised for concentrating on price and oversimplifying products on offer.

Lifesearch policy adviser Matt Morris says: “There is nothing inherently wrong with price comparison websites but protection products are more complicated than general insurance.”

He says most aggregator sites concentrate on life insurance and MPPI and do not offer income protection as it is more complicated to compare. But he points out that this is more appropriate for many than a simple life policy. “They are leaving themselves open to buying the wrong policy.”

The Uswitch life insurance offering is a white-labelled service provided by Direct Life and Pensions. It offers single or joint level life insurance, life plus critical illness, mortgage protection life cover or mortgage protection life cover plus critical-illness cover.

Uswitch head of personal finance Simeon Linstead says the firm has been careful to encourage people to the phone facility it offers to ensure they get advice if they need it. But he says that people who know what they want can find the policy they need and get cover quickly.

“The offering we have is right for our customers. It allows them to compare the price for the whole of the market. If there are no unusual circumstances for a case, it can go on risk in 24 hours. Normally, if you go to a broker, they have to call you back and then the provider has to call you back and you may have to go through a very intrusive phone interview.”

Bright Grey product director Roger Edward says there are two schools of thought on protection sales – one that says no sale should be unadvised and the other that says some cover is better than none. “I have sympathy with the former as we do all our business through advisers but you have to remember that there are vast swathes of people who have never been to an IFA and will never have considered taking advice,” he says.

Linstead says as many as 30-35 per cent of cases could get on risk within 24 hours. An express underwriting service over the phone can cut on-risk time even further, with some able to get immediate coverage. Linstead says this speed should help to boost the conversion rate.

He says: “If you can go on risk over the phone immediately or in 24 hours online, then the dropout does not happen.”

Edwards says the fact that phone advice is available marks the Uswitch service out from some of the others. “That makes it much more attractive than the money-supermarket approach, where all you get is the price. A company such as Direct Life and Pensions will certainly be able to point out the advantages of taking out two single-life policies over one joint life,” he says.

But Morris says benefits offered by some firms, such as nursing care, are hard to pick up without speaking to an adviser or consumers may not be made aware of the advantages of writing a policy in trust. “There is a danger that these aggregator sites make consumers and the industry think it is all about price,” says Morris.

BK principal Peter Chadborn says comparison services do concentrate on price but he believes there is nothing wrong with people buying protection without advice although it is a case of buyer beware. He says: “I am not against non-advised sales. If people have decided they know what they are doing, good for them. It is whether or not they are aware of the protection they are giving up.”


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