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UK insurance consumers don’t shop around enough for, lose out on best deals – FSA

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According to the latest survey by the UK Financial Services Authority, a whopping 70% of the UK consumers do a lot of shopping around and compare the deals available in the market for gadgets like televisions etc, a dismal 43% bother to compare the deals available on UK life insurance.

The survey was conducted by BMRB Omnibus in February 2007 revealed that a majority of the UK Insurance consumers ( about 69%) hated shopping for insurance. Nearly 52% of the respondents said that they had difficulty in comparing the insurance products available in the market. The survey also highlighted the fact that 46% of the consumers weren’t sure if they were being offered a good insurance deal.

The survey was commissioned by the Financial Services Authority (FSA). The FSA aimed at establishing five questions through the survey that would enable the UK Insurance consumers to select the right insurance product for themselves. The FSA pointed out that a number of worrying results emerged during the survey, suggesting the need for some quick measures to resolve them.

The consumers were asked about whether they had insurance cover already, to which 49% of the respondents said that they had no idea what they are covered for. Only 52% of the respondents rarely checked their policy to find out if they have adequate life cover. 25% of the respondents in the survey thought that they had to compulsorily buy the travel insurance sold by their travel agent without any knowledge that they can shop around for a better deal from someone else.

The trend that has emerged from the survey is a serious issue as it shows a low level of awareness among the consumers about life insurance. This highlights the need for creating consumer awareness about life insurance in UK. About 52% of the respondents believed that the insurance company would make it very difficult to get the claims settled. The FSA added that the consumers had a responsibility to give their exact and full details as the claims are settled on the information provided by them.

Vernon Everitt, Director, Retail themes, FSA, said: "Insurance plays an important part in protecting our families, homes and possessions. But, as with all financial products, consumers need to be capable and confident in making the right choices, including shopping around for the best deal and asking the right questions."