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Consumers Duped By Price Comparison Websites Warn Essential Travel

70% of travel insurance policies deemed worthless

Guerilla marketing by price comparison websites has conditioned UK consumers to believe they save money by searching the entire market to find the cheapest prices. Leading travel essentials provider warns holiday makers this is not always the case and travellers should take care when searching for holiday insurance.

Stuart Bensusan explains "Companies on these so called "money saving" websites are operating under several trading names, so whilst a top ten search gives consumers the impression that they are viewing a range of prices from ten different providers, in reality the ten insurance "brands" on display are actually owned by a small pool of three or four companies. In some cases it's as few as two separate providers. Where's the comparison in that?"

A quick search for the cheapest travel insurance policies on Go-Compare reveals its top ten policies are supplied by just two different companies and CompareTheMarket shows only three.

This means if consumers were to purchase a policy from inside the top ten results on Go-Compare there is an eighty percent chance that they will have purchased a policy from the insurance provider Drakefield, and a twenty percent chance they would have purchased a policy supplied by Citybond insurance. On there is a sixty percent chance of purchasing a Rock Insurance policy and a thirty percent chance of purchasing a Blue Insurance policy.

Furthermore, the emphasis on price on comparison websites is leading holidaymakers to select the cheapest option rather than the insurance policy that best suits their needs. "Insurers can only offer the exorbitantly low prices appearing on these sites by levying extremely high excesses on policies." discloses Bensusan.

"Consumers aren't always aware of the level of cover afforded by these cheaper policies; for example, whilst offers the lowest priced policy at £27, it has the highest excess at £300. A review of our recent claims showed 70% of them were for amounts totalling less than £300, which means that had those customers purchased this particular low cost policy they would have had to stump up the entire cost of the claim themselves. By spending just £28.35 more on their annual travel insurance policy, customers can reduce the excess to only £90 on items such as baggage, where claims tend to be for lower amounts."

Bensusan concludes "Consumers need to be wary of websites claiming to offer an overview of prices across the whole market. The cheap policies displayed on these sites are inexpensive for a reason and don't represent value for those that need to claim. We strongly urge holidaymakers to speak with a travel insurance expert rather than relying on misleading price comparison websites."

Notes to editors:

Table 1: Price comparison top ten recommended websites as at 15 November 2010 and actual number of companies operating those policies

Price Comparison Website Top ten insurers displayed (trading names)
1. TIC Citybond
2. Spectrum Citybond
3. Blue Insurances
4. Top Dog Citybond
6. Elect Insure for Travel Ltd
8. Flexicover Direct Citybond
9. Flexicover Direct Citybond
10. Top Dog Citybond

Price Comparison Website Top ten insurers displayed (trading names)
1. InsureFor.Com Rock Insurance
2. Big Blue Rock Insurance
3. Protect Your Rock Insurance
4. Annual Travel Insurance Blue Insurance
5. Big Blue Rock Insurance
6. TIC Citybond
7. Blue Insurance
8. Blue Insurance
9. Protect Your Rock Insurance
10. Rock Insurance

Price Comparison Website Top ten insurers displayed (trading names)
1. Top Dog Rock Insurance
2. Flexicover Direct Rock Insurance
3. Two Point Five Drakefield
4. Responsible Travel Insurance Drakefield
5.Travel Insurance Web Drakefield
6. Bargain Travel Insurance Drakefield
7. Go Travel Insurance Drakefield
8. E Travel Insurance Drakefield
9. Elvia Travel Insurance Drakefield
10. 1 Stop Travel Insurance Drakefield

Price Comparison Website Top ten insurers displayed (trading names)
1. Multitrip Blue Insurances
2. Staysure
3. Protect Your Rock Insurance
4. Top Dog Citybond
5. Flexicover Citybond
6. OUL Direct OUL Direct
7. Blue Insurance
8. Swiftcover AXA
9. One Group
10. Travelplan Online TPS Ltd

Table 2: Cheapest insurance policy and related excess

Provider Cost of cheapest policy Excess
Essential Travel £55.35

Medical £120

Cancellation £90

Baggage £90

Travel Insurance Club £27.72

Medical £300

Cancellation £300

Baggage £300 £31.74

Medical £100

Cancellation £100

Baggage £100 £45.00

Medical £200

Cancellation £200

Baggage £200 £29.99

Medical £150

Cancellation £150

Baggage £150

About Essential Travel

Established in 2001, Essential Travel is one of the UK's leading online travel essentials companies. Since 2002, we've protected over 5 million holidaymakers with our fully-comprehensive, competitively-priced travel insurance, as well as providing priority access to the most sought after car parks, hotels and lounges at all major airports across the UK.

Essential Travel is now part of Holiday Extras.