Comparison portals are becoming increasingly important. Unlike many insurtechs, they may not be turning the entire industry on its head, yet they have undoubtedly changed the market. To date, however, many customers have not realized that there are quite a few brokers among these portals.
As with many changes, the process began rather slowly. When the first comparison portals were launched, the focus was on DSL contracts or switching utility contracts for electricity or gas. The number of portals devoted exclusively to the pension provision and insurance sector was manageable. The promise was that with just one entry, users would be able to find the best interest rates for fixed-term deposits and the cheapest policy for car or home contents insurance.
An idea that was well received. By the time the first large-format ads for comparison portals were placed in the media and even TV commercials, the portals aroused the suspicion of insurance brokers and consumer watchdogs alike. This specifically had to do with the fact that the primary independent brokers and sales representatives could feel the competition in their accounting books. One strong argument put forward by critics is that the portals act as brokers, but do not identify themselves as such.
Are all comparison portals brokers?
The assertion that every comparison portal is also a broker in the legal sense cannot be generalized. However, this is undoubtedly the case with TV-ad supported offers that people throughout the country are familiar with. This may not be immediately apparent to all customers when they first visit the site, but they'll notice it when they start to take an interest in the rates and even want to sign up for them. In this case, we also recommend taking a closer look at the site notice. Still, brokers are not hiding at every page where something is being "compared". It can also be the case that it's an offer that is easy to find by means of search engine optimization, but that is legally only part of a broker or insurer's affiliate network. Thus, only customer data is transferred as a lead in this case. The regulatory framework has become so strict in recent years that "black sheep" who do not inform their customers about their commission income are likely to have a hard time.
The difficult relationship between portals and brokers
The business model of comparison portals is largely based on the commissions paid when the contract is concluded. This direct conclusion of a contract is only possible if customers explicitly waive the legally required consultation during the application process. Though comparison portals are of course a thorn in the side of many brokers, they do not lose all of their customers to the portals - just price-sensitive sectors or people who consider themselves to be fully informed and don't want to rely on brokers.
However, the portals do not replace brokers. For example, a Bitkom study found that many customers see comparison portals as a supplement and do not completely dispense with advice. On the other hand, brokers report that customers come to their initial consultation with a printout of the comparison offers. This also seems to make sense, because, as another study using the example of car insurance showed, there is the largest potential for savings when a consultation is involved.
Case law also puts brokers under pressure
The two leading portals, Check24 and Verivox, should be more strongly obligated to refer to the restrictions involved in their offerings during a legal dispute. They do not compare all tariffs and contracts on the market, but instead a selection that is just too small.
The Karlsruhe Higher Regional Court (OLG) issued a ruling in the fall of last year that is likely to have an impact on the day-to-day business of brokers. This is because they are now obligated to advise their customers about the market as a whole. In other words, the court assumes in its ruling (09/22/2021 - 6 U 82/20) that the law obligates brokers to advise on tariffs that are not offered by the insurer through this distribution channel. The aim is to give customers the opportunity to decide whether they want to conclude a direct contract or take a different route. How this case law will play out in practice is still unclear. According to the ruling, the brokers must indicate which options are available to the customer. It is probably not enough to simply point out which product providers they work with. In individual cases, this is likely to involve expenses.
In short, not all comparison portals have the status of brokers, and there is undoubtedly competition with established sales structures. Nonetheless, they do also provide sales opportunities.
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