Running out of steam?

Motor rates may be stalling by Tom Cooper pinpoints growth strategies to safeguard comparison site expansion.

The continued upward movement in motor rates through the final quarter of 2010 appears to be running out of steam. In what has been a rapidly hardening market, the best price on aggregators is now 30% higher than it was 15 months ago. The natural assumption is that this would work in favour of the price comparison market, as consumers are likely to be tempted to shop around more if faced with such a rise on their renewal rate.

However, consumers may be finding it harder to beat their existing provider’s renewal quote via the price comparison sites due to a number of trends in the market. As first pointed out last spring, one of these trends has been dual pricing by participating brands in favour of existing customers they wish to retain. This began with direct writers and has now stretched to the broker brands.


  • Motor rates continued to rise in the final quarter of 2010, but the rate of increase also continues to slow.
  • More brands are adopting a dual-pricing approach to protect existing books.
  • Commercial arrangements show no sign of alignment to a longer term strategy.
  • Increased competition on household cover is still holding rates back—Go Compare is challenging MoneySupermarket on panel size and competitiveness but quote volumes remain low.
  • A rethink may be required regarding product diversification as home insurance fails to gain traction.

If you wish to read more please view the Post Magazine Article

*Taken from the Post Magazine January 2011