Consumer loyalty and major insurers’ refusal to participate are preventing comparison websites from flourishing in Australia, the Actuaries Institute’s general insurance seminar heard last week.

Ernst & Young senior managers for actuarial services Joshua Ailwood and Hardik Dalal told the event the sites, sometimes referred to as aggregators, may play a bigger role if they can weaken loyalty to established brands and force large insurers to join.

IAG and Suncorp control about 75% of the domestic market and will not allow their products on comparison sites.

Mr Dalal says their decision makes sense because of the aggregators’ strong focus on price rather than brand.

Mr Ailwood says aggregators are becoming better known, particularly through Compare the Market’s advertising, and they now account for 40-50% of new health insurance sales.

Comparison websites have been much more successful in the UK, where there is less brand loyalty and they sell about 70% of all new motor policies.

Mr Dalal says British customers started to focus on price as the key differentiator in motor lines, giving aggregators an invitation to enter the market, which led to further commoditisation of product.

Bids to enter the German and Swiss markets have failed because those consumers prefer to buy through brokers or shop-front advisers.

“In Australia, neither home nor car insurance is as commoditised and that could be one reason why aggregators have not flourished here yet,” he said.