Comparator websites receive similar commissions to advisers for life insurance sales, but they do not deliver the same levels of advice, according to Rice Warner.

The actuary says while most comparators examine a product’s features, the focus is inevitably on price.

“The inadequate link between price and product features is likely to result in consumers overlooking what is being offered for the price they pay.

“Without comparing the product features, consumers may rely on product names and prices to differentiate products.”

Rice Warner has also researched the tools used to help consumers calculate their insurance needs, finding great variations in the recommendations from each comparator.

“Financial advisers will provide their clients with a tailored recommendation for insurance needs,” it says.

“It is likely to set a level of cover that better meets the needs of the individual.”

Advisers also provide service at the claims stage, but Rice Warner found no information on such service from comparators.

“This is a clear disadvantage compared with using a financial adviser, who is expected to help their clients through the full cycle of the life insurance policy.

“A further limitation of comparators is they don’t allow comparisons with all types of insurance products. Most exclude direct insurance policies that have different features, such as the ability to obtain cover with reduced underwriting requirements.”

Comparators also exclude group life in superannuation funds, with most employees holding this cover.

Rice Warner says group cover is usually cheaper than retail, yet someone using a comparator would not know.

“The purpose of a comparator is to use technology to replicate the services of a financial adviser to sell comprehensive life insurance policies to consumers.

“The key profit driver for comparators is to generate consumers’ interest to consider and purchase life insurance, resulting in commissions.”