Net Metrics: Consumer Researching and Purchasing Trends in UK Internet Insurance

Publication Date	March 2007
Publisher	Finaccord
Product Type	Report
Pages	150
ISBN Number	not applicable
Product Code	FIN00149

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Summary

The report titled Net Metrics

Consumer Researching and Purchasing Trends in UK Internet Insurance focuses on two fundamental aspects of Internet distribution of personal insurance in the UK: patterns in consumer behaviour and dynamics in the market for web-based brokers and aggregators, including the impact of on-line providers of general price comparison services. With regards to the former issue, the research investigates several core areas including consumer propensity to purchase ten different types of insurance via the Internet, consumer propensity to use different types of web site in this context and the relative importance of nine key characteristics of web sites selling insurance for encouraging consumer usage to research and / or purchase. As for the latter, the study offers an expanded and detailed benchmarking in terms of consumer awareness, consumer trust and consumer usage to purchase of 70 of the leading web-based aggregators and brokers of insurance in the UK including Auto Direct, COMPAREtheMARKET.com, Confused.com, EasyCover, First Insurance, Insureandgo, MoneyExpert and Moneysupermarket.com. Moreover, it also offers an evaluation of the impact in this market of 25 prominent on-line providers of general price comparison services including Ciao!, Kelkoo and uSwitch. The report can be used in one or more of the following ways:

understand the progress being made by 'traditional' brokers, such as the AA, well-established on-line specialists, such as Confused.com, and recent entrants, such as COMPAREtheMARKET.com;
appreciate whether the market for on-line aggregation and broking of insurance is subject to consolidation and what this means for the full universe of participants in this sector;
evaluate the potential for distributing insurance through different types of web site and how consumer propensity to use 'indirect' channels compares with their likelihood to use the web sites of the insurance underwriters themselves;
gain insight into the extent to which consumers using the Internet to research insurance policies are inclined to obtain quotes from multiple web sites and whether this number is reducing over time;
acknowledge the degree to which new sources of information, such as on-line communities, discussion boards and weblogs, are being used by consumers prior to buying insurance.

The research for this study was carried out during January and February 2007 using the Internet consumer panel of IMRS. In total, completed surveys were filled in and submitted on-line by 1,560 consumers breaking down by age group, household income band and geographical location as depicted in the report prospectus. In addition, for questions that overlap with the sister Net Metrics research and publication covering Internet banking, responses were received from a further 1,540 consumers making 3,100 in total.

Content

0.0 Executive Summary
1.0 Introduction
- Research rationale
- The Internet insurance market has continued to develop rapidly during the last 12 months with a number of new competitors having emerged in the aggregation and broking space
- Research sample
- Research structure
- Research enhancements
- Web-based aggregators and brokers of insurance products
- The universe of web-based aggregators and brokers embraces a variety of organisations with some combining genuine brokerage with captive distribution or tied agency models
- Who owns whom in web-based aggregation and broking of insurance?
- Finaccord
- Net Metrics and other consumer-focused studies
- UK affinity and partnership marketing publications
- IPT / IMRS
2.0 Market Analysis
- Introduction
- Consumer propensity to purchase via the Internet
- Consumers are most likely to have made on-line acquisitions of books or music with almost 60% of respondents having bought insurance via the Internet at least once
- Significant year-on-year growth appears to have occurred for cars, clothing and groceries although it is possible that the number of on-line insurance buyers has hit a temporary peak
- Propensity to research and purchase insurance products over the Internet
- Most consumers who use the Internet to research insurance go on to buy a policy on-line
- Types of web site used for researching and purchasing insurance
- Opportunities arising from growth in Internet sales are not limited to dedicated insurance firms
- Consumers show high willingness to use the web sites of on-line price comparison providers and well over 40% are also likely to use the web sites of traditional affinity partners
- Breakdown by type of insurance
- On-line sales are most likely to be realised among buyers of pet, travel and motor insurance and least likely for life insurance, critical illness insurance and income replacement insurance
- Except for breakdown recovery, on-line sales are usually intermediated in one form or another
- Effectiveness of on-line and off-line marketing prompts
- In spite of competition from other media, television advertising appears to be the most effective
- Few consumers are likely to be influenced by SMS text advertising or on-line pop-up advertising
- The effectiveness of event sponsorship as a marketing prompt appears to be increasing
- Other sources of information and advice used
- Consumers are most likely to consult friends or family members prior to purchasing insurance although a variety of other sources are also used by a significant percentage of respondents
- Only around 10% of buyers of on-line insurance pay any attention to comments on 'blogs'
- Number of quotes solicited prior to purchasing insurance over the Internet
- Close to 90% of consumers still solicit quotes from at least three web sites prior to purchasing although there is some evidence of a shift towards use of a smaller number of web sites
- Recognition and usage of providers of general price comparison services
- A number of general price comparison providers have begun coverage of insurance products although the nature of this aspect of their service varies significantly from entity to entity
- Three general providers of price comparisons are recognised by over 50% of respondents although the degree to which these are utilised to search for insurance is significantly lower
- Characteristics of effective web sites for insurance products
- Almost 60% of consumers consider a site's ability to cover the whole mkt. to be very important
- Over a quarter of respondents are comfortable with using a site with no telephone support
3.0 Competitor Analysis
- Introduction
- Consumer awareness of aggregation and broking web sites
- The recognition rate of Confused.com is now close to those of the AA and the RAC and has advanced significantly in comparison to the investigation undertaken in 2006 a performance matched by a number of the other entities covered by both surveys
- Well over half of the 70 web brands covered are not recognised by over 85% of respondents
- Consumer trust of aggregation and broking web sites
- Several web brands have achieved a significant rise in their trust rating during the last year although the majority lack the financial resources to genuinely win the trust of consumers
- Consumer usage to purchase of aggregation and broking web sites
- Confused.com is in poll position to overtake the AA in terms of on-line sales with a further ten aggregators and brokers having been used by at least 2% of consumers
- The market is characterised by a breakaway pack and the vast majority of 'stragglers'
- Insureandgo's score for utilisation is much higher than its rating for awareness would suggest
- The AA's rating for trust is bolstered by the fact that breakdown recovery is its core business
- More resps. bought through Confused.com in the last year than in any previous time frame
- While Confused.com is consolidating its leadership position in the aggregation market it does not appear that this sector has been subject to consolidation during the last year
4.0 Aggregator And Broker Profiles
- Introduction
- 4.1 17to40 (www.17to40.co.uk)
- 4.2 4YoungDrivers (www.4youngdrivers.co.uk)
- 4.3 AA (www.theaa.com)
- 4.4 AdviceOnline (www.adviceonline.co.uk)
- 4.5 A-Plan (www.aplan.co.uk)
- 4.6 Auto Direct (www.autodirectinsuranceservices.co.uk)
- 4.7 AWD Moneyextra (www.moneyextra.com)
- 4.8 Bell (www.bell.co.uk)
- 4.9 British Insurance (www.britishinsurance.com)
- 4.10 BUDGET (www.budgetinsurance.com)
- 4.11 COMPAREtheMARKET.com (www.comparethemarket.com)
- 4.12 Confused.com (www.confused.com)
- 4.13 CoverSave (www.coversave.co.uk)
- 4.14 Diamond (www.diamond.co.uk)
- 4.15 Direct Choice (www.directchoice.co.uk)
- 4.16 Direct Life & Pension Services (www.payingtoomuch.com)
- 4.17 Easy Quote (www.easy-quote.co.uk)
- 4.18 EasyCover (www.easycover.com)
- 4.19 eCar (www.ecarinsurance.co.uk)
- 4.20 EINSURED (www.einsured.co.uk)
- 4.21 elephant.co.uk (www.elephant.co.uk)
- 4.22 Endsleigh (www.endsleigh.co.uk)
- 4.23 Express Insurance (www.expressinsurance.co.uk)
- 4.24 First Insurance (www.first.co.uk)
- 4.25 Girl Motor (www.girlmotor.com)
- 4.26 Goodinvestor.com (www.goodinvestor.com)
- 4.27 insurance.co.uk (www.insurance.co.uk)
- 4.28 Insurancewide.com (www.insurancewide.com)
- 4.29 insure (www.insure.co.uk)
- 4.30 Insureandgo (www.insureandgo.com)
- 4.31 InsureYourMotor.co.uk (www.insureyourmotor.co.uk)
- 4.32 Interactive Investor (www.III.co.uk)
- 4.33 Its4me (www.its4me.co.uk)
- 4.34 Lady Insure (www.ladyinsure.co.uk)
- 4.35 Ladybird Insurance (www.ladybirdinsurance.co.uk)
- 4.36 Life Brokers (www.lifebrokers.co.uk)
- 4.37 Life Cover Extra (www.lifecoverextra.com)
- 4.38 Life Cover Made Easy (www.lifecovermadeeasy.co.uk)
- 4.39 LifeCushion (www.lifecushion.co.uk)
- 4.40 LifeSaver Direct (www.lifesaveronline.co.uk)
- 4.41 LocalBroker (www.localbroker.co.uk)
- 4.42 masterquote (www.masterquote.co.uk)
- 4.43 Missmotorquote (www.missmotorquote.co.uk)
- 4.44 MoneyExpert (www.moneyexpert.com)
- 4.45 Moneynet (www.moneynet.co.uk)
- 4.46 Moneyquest (www.moneyquest.co.uk)
- 4.47 Moneysupermarket.com (www.moneysupermarket.com)
- 4.48 Moneyworld (www.moneyworld.com)
- 4.49 Motor Direct (www.motordirect.co.uk)
- 4.50 MotorQuoteDirect (www.motorquotedirect.co.uk)
- 4.51 MRL Insurance Direct (www.mrlinsurance.co.uk)
- 4.52 Only Finance (www.onlyfinance.com)
- 4.53 Open + Direct (www.openandirect.com)
- 4.54 Peoples Choice (www.peopleschoice.co.uk)
- 4.55 Q4 Insure (www.q4.com)
- 4.56 Quick Car Quote (www.quickcarquote.co.uk)
- 4.57 QuoteA (www.quotea.co.uk)
- 4.58 Quoteline Direct (www.quotelinedirect.co.uk)
- 4.59 Quotezone (www.quotezone.co.uk)
- 4.60 RAC (www.rac.co.uk)
- 4.61 Screentrade (www.screentrade.co.uk)
- 4.62 swiftcover.com (www.swiftcover.com)
- 4.63 Swinton (www.swinton.co.uk)
- 4.64 The Insurance Centre (www.theinsurancecentre.co.uk)
- 4.65 The Motley Fool (www.fool.co.uk)
- 4.66 The Thrifty Scot (www.thriftyscot.co.uk)
- 4.67 theidol.com (www.theidol.com)
- 4.68 Unravelit (www.unravelit.com)
- 4.69 webmoney (www.webmoney.co.uk)
- 4.70 yesinsurance.co.uk (www.yesinsurance.co.uk)
Graphics / Tables
- Summary of on-line aggregation and broking of insurance in France, Germany, Italy and Spain, Q1 2007
- Sample breakdown by age group, household income band and geographical location - insurance questions
- Sample breakdown by age group, household income band and geographical location - entire survey
- Aggregators and brokers of insurance covered for the first time in the Q1 2007 research
- Who owns whom in web-based aggregation and broking of insurance in the UK?
- Who owns whom in web-based aggregation and broking of insurance in the UK? (continued)
- Who owns whom in on-line provision of general price comparisons in the UK?
- Consumer propensity to purchase assorted goods and services via the Internet, Q1 2007
- Cons. prop. to purchase assorted goods and services via the Internet, Q1 2006 and Q1 2007 comp. (data)
- Consumer prop. to research and purchase insu. products over the Internet, Q1 2006 and Q1 2007 comp.
- Types of site used for res. and purch. ins., inc. web sites of orgs. for which dist. of ins. is a sec. act., Q1 2007
- Tps. of site used for res. and purch. ins., inc. web sites of orgs. for wh. dist. of ins. is a sec. act., Q1 2007 (data)
- Use of on-line and off-line channels for purchasing assorted insurance policies, Q1 2007
- Use of on-line and off-line channels for purchasing assorted insurance policies, Q1 2007 (data)
- Breakdown of on-line channels by type of web site used for purchasing assorted insurance policies, Q1 2007
- Breakdown of on-line channels by type of web site used for purchasing assorted ins. policies, Q1 2007 (data)
- Effect. of on-line and off-line mktg. prompts as a means of persuading custs. to visit part. web sites, Q1 2007
- Effect. of mktg. prompts as a means of pers. custs. to visit part. web sites, Q1 2006 and Q1 2007 comp. (data)
- Other sources of information and advice used prior to purchasing insurance products, Q1 2007
- Other sources of information and advice used prior to purchasing insurance products, Q1 2007 (data)
- Number of quotes solicited by cons. prior to purchasing ins. over the Internet, Q1 2006 and Q1 2007 comp.
- Number of quotes solicited by cons. prior to purch. ins. over the Internet, Q1 2006 and Q1 2007 comp. (data)
- Recognition and usage of on-line providers of general price comparison services, Q1 2007
- Recognition and usage of on-line providers of general price comparison services, Q1 2007 (data)
- Imp. of web site characteristics in pers. custs. to res. and / or purch. ins. through a part. web site, Q1 2007
- Imp. of web site characts. in pers. custs. to res. and / or purch. ins. through a part. web site, Q1 2007 (data)
- Ranking of web sites of aggregators and brokers of insurance by overall consumer awareness, Q1 2007
- Ranking of web sites of aggregators and brokers of ins. by overall consumer awareness, Q1 2007 (cont.)
- Ranking of web sites of aggregators and brokers of insurance by consumer trust, Q1 2007
- Ranking of web sites of aggregators and brokers of insurance by consumer trust, Q1 2007 (continued)
- Ranking of web sites of aggregators and brokers of insurance by consumer usage to purchase, Q1 2007
- Ranking of web sites of aggregators and brokers of ins. by consumer usage to purchase, Q1 2007 (cont.)
- Correlation between consumer awareness and consumer trust of web sites of aggs. and brokers of insurance
- Correlation between cons. awareness and cons. usage to purchase of web sites of aggs. and brokers of ins.
- Correlation between cons. trust and cons. usage to purchase of web sites of aggs. and brokers of insurance
- Comparison of recent and historic usage to purchase of web sites of aggs. and brokers of insurance (1)
- Comparison of recent and historic usage to purchase of web sites of aggs. and brokers of insurance (2)
- Consumer awareness, trust and usage to purchase of the www.17to40.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.4youngdrivers.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.theaa.com web site
- Consumer awareness, trust and usage to purchase of the www.adviceonline.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.aplan.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.autodirectinsuranceservices.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.moneyextra.com web site
- Consumer awareness, trust and usage to purchase of the www.bell.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.britishinsurance.com web site
- Consumer awareness, trust and usage to purchase of the www.budgetinsurance.com web site
- Consumer awareness, trust and usage to purchase of the www.comparethemarket.com web site
- Consumer awareness, trust and usage to purchase of the www.confused.com web site
- Consumer awareness, trust and usage to purchase of the www.coversave.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.diamond.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.directchoice.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.payingtoomuch.com web site
- Consumer awareness, trust and usage to purchase of the www.easy-quote.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.easycover.com web site
- Consumer awareness, trust and usage to purchase of the www.ecarinsurance.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.einsured.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.elephant.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.endsleigh.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.expressinsurance.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.first.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.girlmotor.com web site
- Consumer awareness, trust and usage to purchase of the www.goodinvestor.com web site
- Consumer awareness, trust and usage to purchase of the www.insurance.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.insurancewide.com web site
- Consumer awareness, trust and usage to purchase of the www.insure.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.insureandgo.com web site
- Consumer awareness, trust and usage to purchase of the www.insureyourmotor.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.III.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.its4me.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.ladyinsure.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.ladybirdinsurance.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.lifebrokers.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.lifecoverextra.com web site
- Consumer awareness, trust and usage to purchase of the www.lifecovermadeeasy.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.lifecushion.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.lifesaveronline.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.localbroker.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.masterquote.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.missmotorquote.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.moneyexpert.com web site
- Consumer awareness, trust and usage to purchase of the www.moneynet.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.moneyquest.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.moneysupermarket.com web site
- Consumer awareness, trust and usage to purchase of the www.moneyworld.com web site
- Consumer awareness, trust and usage to purchase of the www.motordirect.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.motorquotedirect.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.mrlinsurance.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.onlyfinance.com web site
- Consumer awareness, trust and usage to purchase of the www.openandirect.com web site
- Consumer awareness, trust and usage to purchase of the www.peopleschoice.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.q4.com web site
- Consumer awareness, trust and usage to purchase of the www.quickcarquote.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.quotea.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.quotelinedirect.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.quotezone.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.rac.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.screentrade.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.swiftcover.com web site
- Consumer awareness, trust and usage to purchase of the www.swinton.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.theinsurancecentre.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.fool.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.thriftyscot.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.theidol.com web site
- Consumer awareness, trust and usage to purchase of the www.unravelit.com web site
- Consumer awareness, trust and usage to purchase of the www.webmoney.co.uk web site
- Consumer awareness, trust and usage to purchase of the www.yesinsurance.co.uk web site