Want to save money in the long run? Stop using fucking price comparison websites for car insurace
From what i can gather and understand, its all a con to make you pay more in the long term, not just for insurance, but for anything else that you get on credit - credit cards, loans, mortgages, the lot.

WARNING: long winded text ahead.

Check the terms and conditions that you agree to when you do a quotation search on a comparison website. it gives permission for each and every insurer that the comparison websites search on your behalf to credit check you.

On my last bash at a comparison site for insurance, I got about 50 quotes returned (none which were cheaper than my renewal) and for my troubles, if i recall correctly, 10 'insurance' searches & 3 'credit' searches on my credit file from random insurance companies. Be aware the number of insurers doing credit searches for quotations is growing as new insurance rules regarding quotes and credit ratings have come into play (see below)

Now, normally an insurance company search of your file is for identification purposes only and does not show up to prospective lenders (eg, those quote searches on your credit file should not affect your credit score). Though whats happening with insurers in the last year or so is that they are now allowed to use your credit score as a factor when calculating your premium. This means that having a low credit score can put your quoted premium up (though not sure why the insurers think that a person who is in debt or managing money badly is a bad driver). Im guessing more insurers seem to be doing this as a way to screw more money out of people who can ill afford it (see here www.ukmoneypot.co.uk/bad-credit-bad-driver.htm - though note the article is nearly a year old and now comparison websites allow insurers to credit check you)

As I understand it, some of the crappier insurers will only offer the 'monthly payment' option once they have searched your credit - so the prospective insurer takes your agreement to the terms on the comparison site as permission to do those credit searches, before telling the comparison site what your 'monthly' premium will be. This is because some insurers offer monthly payments to the prospective insured via outsourced credit companies (eg banks or other lenders) and can only give an accurate monthly payment fee once the lender has assessed, based on a credit search of your credit file, what your interest rate should be. Think about it, how could a prospective insurer quote you a monthly fee on a comparison site, when the monthly fee is from an outsourced credit company - without doing this search and passing the data from your credit search over to their outsourced credit company for a quote?

dont believe me? Go and check on some comparison sites, read the terms and conditions. Lets take a look at the terms of a comparison site which has a really annoying advert, the below nugget of info is buried deep within the plethora of text (i wont elaborate on which comparison site, google the text below and you will see that pretty much all the comparison sites say this)

--begin
Credit searches

Many insurance and financial services providers operate a credit scoring system and will carry out checks with credit reference and fraud prevention agencies. These checks will include electoral roll and credit information. The insurance checks are registered as general insurance searches and may be viewed by other companies when you apply for credit or insurance. Often the financial services quotes you request will only do a credit check once you have decided on a particular supplier.....

PLEASE REMEMBER while we do not carry out credit searches on our website, our partners may do so at any stage of the quote process.

-end

Note that "partners" means "insurers" and that they say "Often the financial services quotes you request will only do a credit check once you have decided on a particular supplier", but what they do not say is that "always the financial services quotes you request will only do a credit check once you have decided on a particular supplier".

Additionally "any stage of the quote process" means any time until the comparison site displays a particular price for a particular insurer on your screen. My point is, some insurers do the checks at the comparison/quote stage and by using some comparison sites, you are agreeing to that happening and you are agreeing that those searches will show up to other lenders or insurance companies in future. And thats not just one search for all the quotes you get using the comparison website, thats one search for every insurance company that return a quote (should the company concerned decided to search you)

Why is this bad? Not only does pre-existing bad credit push your premium up, if you have more than three searches on your file within a few months of eachother then this pushes your credit score down. Loosely translated, the more credit searches you have in the past 12 months, the worse your credit rating is. In pushing the credit score down by doing comparison searches over lots of insurers, your chances of getting credit are reduced, your prospective interest rates are pushed up and - shock of shocks - your car insurance premiums go up. This means, purely and simply, that the more comparison quotes you do, the more risk there is that your credit score will go down and your insurance quotes will go up.. Its also no co-incidence the major comparison websites are either owned by major insurers, or have shareholders/financial backers that are major insurers.

So lets imagine I search for insurance quotes in month 1. Then again in month 2 and again in month 3 - Under this system, I would expect to see my premiums to have gone up in month 2 compared to month 1, and up more in month 3 compared to month 2. While many people would just think "meh, rising car insurance prices," not many would think "shit, did those quotes I did the last couple of months push this price up because the insurers were searching my credit file to quote me?"

Clever system, eh? Not many consumers have cottoned on to it yet.

My score at one credit agency dropped 30 points after using a popular comparison site just to find a new deal on car insurance. The point drop was nothing to do with how i manage my accounts (all accounts using less than 50% credit, all paid on time etc), it was all down to extra searches appearing on my file.

I hate comparison sites for this reason. Id rather just ring round a few proper places.
(shamen Geekius Maximus, Sat 12 Nov 2011, 3:13, 6 replies)

I didn't really understand that
But it's nice to have confirmation the price comparison web sites aren't soley there for my benefit the shits. My default setting is that they're all cunts anyhow.
(dyllon nice beaver., Sat 12 Nov 2011, 3:26, closed)

i suppose in the simplest terms
my understanding is thus : since the new rules about tying credit scores and insurance premiums came into play, the more 'comparison' searches you do for car insurance, the higher your premiums get. The fact that comparison websites tend to be owned or financed in some way by insurance companies is completely unrelated to this process *cough*

Bastards, aint they?
(shamen Geekius Maximus, Sat 12 Nov 2011, 3:31, closed)

I'm actually impressed
That you managed to make an essay out of something that could've taken one paragraph to sufficiently get the point across!
( 6821isnotmyPIN Bored cig., Sat 12 Nov 2011, 10:03, closed)

drunken
3am ramblings :)
(shamen Geekius Maximus, Sat 12 Nov 2011, 15:09, closed)

Tin foil hat much?
i work in insurance, and frankly you are talking bollocks.
( Wicca'd Witch needs ideas for a new sig on..., Sun 13 Nov 2011, 3:01, closed)

.
(dave likes cheese, Mon 14 Nov 2011, 13:35, closed)

I do this purely to avoid junk mail etc..... Simply fill out the comparison site with a made-up name and use the postcode of the houses across the street - That way I get an accurate enough quote, and I then contact the cheapest insurers directly with my real details.
Simples.
(dave likes cheese, Mon 14 Nov 2011, 13:36, closed)