Insurance Blog will be the first to admit that the FSA in it’s swansong is at least trying to do the right thing, with some notable recent successes in prosecutions and forcing the banks to heel over the mis-selling of payment protection insurance.

Those small insurance brokers, insurance agents, consultants and intermediaries whose rising FSA authorisation costs and annual fees have helped fund the Financial Services Compensation Scheme to pay for the banks mis-selling crimes would be the first to disagree, however their contempt for the organisation might be tempered some if they were aware of the FSA’s latest moves against their largest competitors……

The Insurance price comparison websites and aggregators selling general insurance products on the Internet.

If the FSA’s latest proposals for the regulated Selling of Insurance on the Internet are enforced, this could be a good thing for all small insurance intermediaries out there, who collectively currently receive less than 5% of the total internet traffic searching for Insurance.

First in the line of fire has been the Insurance price comparison websites, particularly those that compare car insurance and home insurance, and recommend insurance products to the public. In it’s investigation the FSA found serious breaches of it’s rules on the regulation of giving advice and selling of insurance. It subsequently wrote to 19 firms that it considers are breaking these rules in regards to advice and arranging contracts of insurance.

The letter advised the 19 Price Comparison websites:

· review your regulated activities and ensure you are appropriately authorised or otherwise exempt;

· ensure that you only enter into contracts with firms holding the appropriate authorisation and permissions to conduct that regulated activity (or who are exempt);

· withdraw your assistance from third parties if they are in breach of the general prohibition;

· review your disclosure documentation, sales procedures and your terms and conditions and make sure that these are compliant with all relevant regulatory requirements including our Guidance consultation Principles, ICOBS and the Unfair Terms in Consumer Contracts Regulations 1999. In particular, you should ensure they comply with  requirements on: customer eligibility, status disclosure, advice suitability, providing a proper statement of demands and needs, and that you do not seek in your terms and conditions to exclude liability for the regulated activities you are undertaking; and
establish, implement and maintain adequate policies and procedures to ensure your firm complies with all relevant obligations under the regulatory system and for countering the risk of furthering financial crime, in particular breaches of the general prohibition and restrictions on financial promotion.

A price comparison firm may be arranging contracts of insurance where its activities involve any of the following:

· the firm provides links to product companies or intermediaries for the purpose of enabling the customer to purchase a chosen insurance product;

· the firm requires a pre-purchasing questionnaire to be completed in order to filter sales (i.e. where the intermediary asks a series of questions and then suggests several specific products.

Under these guidelines it would appear that any website that collects information with the view to arranging insurance or even provides a link, is breaking the FSA rules if not authorised to do so….

The FSA found the folowing types of Insurance websites in breach where they are not FSA regulated:

· the firm provides a comparison of the terms of different policies as opposed to a passive display of the features of different policies;

· the firm runs a website which is funded by one or more insurance or mortgage providers (i.e. it is not ‘independent’); and/or
· the firm offers a special discount on the product to its website users.

. Even where no financial benefit is derived, the firm may still be making arrangements if it brands the comparison service with its own name, endorses the service or otherwise encourages users to respond to it, negotiates special rates for users, or holds out the service as something arranged for the benefit of users.

Advising on insurance
The FSA now considers any type of recommendation as giving advice. In addition where the effect of the firm’s arrangements constitutes a recommendation to purchase a specific product or products, that recommendation is likely to involve the firm giving regulated advice.

Some indicators of where a website or price comparison website may contain advice which is regulated by law include:

· where the name or logo of only one insurance product is displayed on the website in a manner that suggests that the particular product is to be preferred over other products (for example, a particular logo might appear on a webpage containing generic advice on the merits of incapacity insurance contracts);

· where a particular insurance product is recommended as the ‘pick of the best’ product out of a number of other products in its category;

· where a particular insurance product is star-rated by a website, for example, the product is awarded five out of five stars, by contrast to a similar product which is awarded two out of five stars;

· where a scripted questionnaire gives a recommendation or opinion which influences the choice of insurance product and then goes on to identify a particular insurance or regulated mortgage product to which the advice relates;

· where the questioning process has resulted in the identification of one or more particular contracts of insurance based on a non-objective assessment of the product features;

· where the website generally makes any value judgement as to the merits of one or more insurance products or regulated mortgage contracts, by way of scripted questioning or otherwise;

· where generic best buy tables are used and are not populated from specific consumer information this might be advice depending on the consumer’s experience of it. So, for example, a website containing solely generic ‘best buy’ tables explaining the merits of futures as opposed to options would not be advice, but if those tables guide the consumer to a particular insurance product based on the consumer’s personal requirements, this is likely to be regulated advice;

· where generic statements on a website are not dependent on consumer information being populated; this could be regulated advice where they are displayed in such a way that the website operator is making value judgements as to the merits of buying, selling, etc. For example, ‘The products of the month are XYZ, ABC and DEF investments because they offer the best returns’.

Clearly if implemented to the full the following types of insurance marketing would be illegal on the Internet in the UK for all websites that are not authorised and regulated and will have huge ramifications for the way insurance is distributed online in the future:

· Linking of any sort to Insurance Provider or Insurance Comparison website (Text links and Banner ads)
· Distributing Articles and Media that link to or promote insurance products (Article Directories, Video Directories, Social Media, Blogs)
· Affiliate Marketing and Vertical Marketing by non regulated affiliates
· Review Websites
· White Labelled Websites
· Marketing Websites

Insurance Blog thinks that this is a good thing, if it is properly policed as it will remove a lot of the chaff from the Internet, much eminating from unqualified webmasters both inside and outside of the UK. We are of course authorised and regulated under our Insurance Publishing Group owners Insuretec Ltd. FSA no. 422934 and would love to see our FSA fees used in this way! And as a word of advice, when filling out an insurance proposal form online, no matter it’s detail, always check that the website states its FSA number and regulatory status, which can also be found at the FSA’s website.

Related posts:

1. Google Buys Insurance Aggregator Beatthatquote.com
2. Quotezone comes out top in UK car insurance price comparison website review!
3. UK TV Ad Revenue Underwritten by Car Insurance Price Comparison War!

The big insurance industry story that made the headlines of both the trade papers and the nationals this month was mega global search engine come media owner come O/S provider come whatever else they are now, company Google have bought financial comparison site Beat That Quote for a cool £37.7m.

It was an interesting if somewhat fairly inevitable move from the mega global search engine come…. well you get the point.

I say inevitable as apart from the fact that Google are trying to get their grubby little mitts into pretty much every possible vertical there is to be had, it was also a fairly well known industry ‘secret’ that they were looking to step into the financial comparison site arena, ever since news of their failed attempt to purchase LoveMoney.com.

In many ways Beat That Quote fit the acquisition profile perfectly for Google. They are a ‘two click’ property (a website which has short, quick user journey) and Google have often shown a taste for these in the past.  Also the business model of aggregators is proven to be successful as long as you have traffic and Google have more traffic than you can shake a big, digital stick at.

The proprietary comparison technology Beat That Quote represents is arguably the strongest in the sector with exception of Moneysupermarket.com which would have proven to be a much more complex acquisition. They brought in £6m in revenue last year but due to a hugely aggressive (and expensive) customer acquisition strategy made a £2m loss. Google can take a large part of the cost away from delivering ‘eye balls on the page’ so has the opportunity to turn the deficit around within a relatively short time.

So on the surface the move makes sense however there are a number of under currents to this deal that have got those in the insurance mergers and acquisitions sector and beyond questioning the wisdom of the move.  The biggest question marks are about Beat That Quotes existing ties with Google’s two biggest rivals Yahoo! and MSN.

One particularly interesting conflict is that Beat That Quote essentially engineered MSN Compare on a white label basis – whether maintenance and further development is part of the contract remains unclear but it will be interesting to see if Beat That Quote will continue its white label policies now they are under Google’s banner. It also seems that Beat That Quote already has agreements in place with both MSN and Yahoo! which provide a  big chunk of their existing traffic. Will these two major competitors of Google’s be so happy to continue to push traffic to their nemesis?

Of course this second issue is a lesser worry to Google and they will probably bring far more traffic to the table than Beat That Quote could lose from MSN and Yahoo! This is certainly more than feasible when given Google’s growing dominance of all things… well just all things.

Yet despite their omnipresent magnificence, it was just hours after the takeover that Google was having SEO issues with Beat That Quote. Embarrassingly Google were forced to remove all of Beat That Quotes SERPs (Search Engine Results Pages) due to certain alleged questionable SEO practices (Link buying etc – just the type of questionable practices that Google had recently made a big song and dance about clamping down on.

To be fair to Google they stood by their own rules in this case even though it was their new baby getting hit. However, the timing of removing the SERPs could be interpreted as a pretty slick PR move by the cynical amongst us. Their PR machine does seem to be currently entrenched in a full on battle to stem the growing tide of distrust amongst the masses of Google’s ever growing claim of total world dominance.

In fact in my humble opinion the Google PR team is only just about managing to stop the company overtaking Microsoft as the worlds most loathed organization – although on these shores the UK Government is having a fair crack at the title as well at the moment, but we’ll save that for another day.

For now however, Google have magnanimously allowed their own company back onto the SERPs (after what one assumes was some vigorous housekeeping) and have swiftly established a very firm footing in the financial services market.

What this means to the market remains to be seen, but it is clear that the fiercely competitive insurance aggregator sector now has a new contender with the technology, the audience and the financial backing to seriously shake things up. It’ll be an interesting ride that’s for sure.

Related posts:

1. Go Compare Elsewhere! Google slaps aggregator
2. Don’t Renew Your Car Insurance Until You’ve Read This!
3. Google Arrested – We Hope It Had Valid Car Insurance!

This old advertisement for The London Assurance Company from the turn of 19th century suggests that insurance was something that you didn’t talk about in public – like money!

‘Very good people to deal with”  What’s all that about then?

Good at what? Deal with What?

“Good Day Mister. I’m from London Assurance. We’ll deal with it for you! (Cockney Accent required)

An interesting thing about the advert is the Firemark in the centre depicting the coat of arms of the Corporation of the City of London, The George Cross.

Also notice the EC4 address which is still very much an Insurance area of the City.

For those of you who don’t know what a fire mark is, a Firemark was a plaque that was placed on the exterior of a property in full public view to indicate to the privately owned fire brigades that the house was covered by home insurance and was worth saving.

If you didn’t have a firemark on your wall and your house caught fire – then it burnt!

Fortunately the days of proving you’ve got home insurance before the Fire Brigade will start putting out the fire, are long gone. Fire Marks though now very collectable, were the very first form of Insurance Marketing and advertising.

By the 1920′s advertising for Home Insurance and property insurance had moved on with the emphasis on courtesy, service and prompt settlement as this fascinating advert from the still existing Eagle Star Company, now part of the Zurich group demonstrates.

Hmm…. It still took them nearly 2 months to pay the claim!

I wonder how many of those words prompt settlement and service, you’ll see on price driven television insurance adverts or the Internet insurance marketing campaigns of today!

Related posts:

1. Insurance Marketing : NewTools For A Modern World
2. Insurance Marketing Enters Cyberspace
3. UK Housing Market Home Insurance Mini Boom

Back in the 1960′s if you were lucky you had a black and white televison – the box!
with an aerial that looked like a sea mine or something out of Doctor Who sitting on top of it.

There were 2 UK TV Channels:

The BBC – Mother of the Nation and voice of the world……

& ITV – which was a loose consortium of regional independent television companies that broadcast on their own frequency AND network distribution relay.

This meant that every time you changed channel, which was a process of turning a huge dial until you got a fuzzy ghost image – you had to turn the aerial as well to switch to a different signal supplier.

This caused much distress in every UK Household with people arguing over aerial placement whilst trying to watch fuzzy images of man supposedly walking on the Moon.

The Independent Television Companies were funded by advertising revenue for commercials placed in programme ‘intermissions’ known in the UK as ‘Commercial Breaks’. This allowed companies like Granada to fund their own programmes and make ‘soaps’ like Coronation Street.
Product placement was banned on The BBC and was also severely limited as to the acceptable use of on screen products, within ITV programme drama of the day.

This ban has very recently been lifted and you might soon even see the BBC’s Phil Mitchell on Eastenders popping down to his local Post Office TM for some Travel Insurance or visiting a car insurance comparison website for his Jaguar insurance, coming to our screens as desperate TV production companies try to raise additional funding in hard times.

Even the BBC will not remain immune in the face of falling TV viewing figures and the rise of integrated digital services.

Today ITV is still reliant upon revenue sourced from intermission commercials, however with global distribution opportunities for selling programmes abroad they are now able to find sponsors for most popular shows.

According to a recent survey by business intelligence group DataWatch Monitor UK, Insurance adverts account for 52% of the total advertising revenue spend on UK TV commercials and specifically car insurance which accounts for 63% of that.

So Who is spending all this money, millions of pounds that is underwriting some great UK independent TV productions?

Well unless you live under a rock or don’t own a screen (Boxes are consigned to pre-history along with the Dodo and the Betamax by the way!), you can’t have failed to notice that there is a car insurance price comparison site war going on out there at the moment with the BIG 4 all trying to outdo each other on spend and it’s getting dirty……….

So who are the big 4?
Well in no particular order , though Google has one….

Money Supermarket.com
Confused.com
Compare The Market.com
Go Compare.com

So who is winning this war?

Well it’s hard to give a definitive answer because campaigns are in a constant state of flux and one month it might be the furry meerkat toy rodent or the next month, the fat opera singer at No.1 in the Sales Charts. It is difficult to COMPARE!

The TV ads always tell the prospect car insurance purchasers to visit their website, so a fairly accurate measure of website usage over time by website name search, can be extracted from Google and here are the results….

WACKY RACES
As you can see, that annoying pompous man from the Dragons Den is leading the way by far at the moment with the furry rodent bringing up the rear. This is likely to change at Christmas when Compare The Market bring out the talkng meerkat. Looks like the fat annoying tenor over there Ad is working!!! For Now!

To see how your website compares to the big boys do your own visitor comparison with your competitiors over at Google Trends for Insurance Price Comparison giants

Related posts:

1. Go Compare Elsewhere! Google slaps aggregator
2. Car Insurance Online – Forget It
3. America joins the car insurance quote comparison frenzy