Price comparison websites take over £650 million in commission each year from consumers. That’s the finding from a recent YouGov survey undertaken by saveitbuddy.com, which claims to be the UK’s only comparison website that gives cash back on insurance and energy deals.
The survey suggests that 10.1 million GB adults used comparison websites in the past year, spending an average commission of £64.59 – amounting to £652.5 million.
In addition, the study found that most people are unaware of the full costs of using comparison websites to find the best deals on insurance and energy. It highlighted that 21 percent believe these websites take up to 5 percent commission, and one fifth (20 percent) thought this figure stood at between 5 and 10 percent. The average statistic for this is actually 24 percent – yet only 2 percent of those questioned suggested that price comparison sites would take between 20 and 25 percent in commission costs. Commenting on this finding, Cedric Clarke, co-founder and commercial director of saveitbuddy.com, said:
“This figure alone highlights that there is a real lack of understanding of how the price comparison market works. Consumers obviously appreciate the fact that they are paying commission on the deals, but few realise exactly how much they are spending on this part of the transaction.”
Through saveitbuddy.com’s price comparison mechanism, users can receive anything from £15 to £62 cash back, per transaction. It presents a new way of comparing insurance and energy, and saving online, because the customer receives the majority of commission back after the transaction has completed.
The research also concluded that one quarter (26 percent) of online GB adults spend between £100-£499 on price comparison websites each year (an average of £269.14). When asked for the top reason why they use them, more than one third (37%) of respondents advised it was because they believe they provide the cheapest deals, but it seems this is not always the case. And 27 percent suggested that they use comparison sites to save them time when looking to renew their insurance and energy suppliers.
Cedric Clarke added: “Large numbers of people are clearly using price comparison websites to renew their insurance and energy deals, and benefiting from major savings. However, few appreciate the commission levels they are paying. Every household needs insurance, and it is likely that those who don’t use price comparison websites for insurance or utilities renewals (39 percent of the online respondents surveyed), will perhaps use the services of a broker instead, who also receive between 20-25 percent commission, as a rule of thumb.
“During this period of economic uncertainty, consumers are watching every penny and looking for the best deals, from shopping to car and home insurances. I believe it is vital for the industry to be transparent about the levels of commission their customers are paying.
“saveitbuddy.com’s aim is to reduce its customer’s outgoings each year, and to ensure they receive their cash back as early as possible, whilst saving time and providing the best choice. saveitbuddy.com offers comparison with cash back on insurance and energy deals; the only question is whether the the rest of the industry will follow suit.”
saveitbuddy.com customers, who have never switched energy providers before, could save up to £480 per year, as well as earn £15 cash back.
The site also has exclusive deals including Vauxhall, Ford and Chevrolet cars; offering the lowest market prices on new models.
Unlike other voucher sites, Save it Buddy doesn’t show any expired deals on the site; all deals on more than 2,000 UK brands are live.
The online ‘Click Diary’ also helps customers to effectively manage their money, and time.
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