Suncorp and IAG’s refusal to allow their products on comparison websites contributes to a lack of transparency, reduced competition and ill-informed consumers, UK-based insurance comparator Compare the Market says.

Comparators are an increasingly important source of information for consumers, it argues in its submission to the financial system inquiry.

A high percentage of people do not shop around for general insurance due to the time, effort and difficulty involved, it says.

Major players in life, income protection, health and travel insurance allow their products to be compared openly, but the two general insurers that control 70% of the market continue to hold out, according to the submission.

Compare the Market says insurers’ current customers are often excluded from special deals for new clients because they cannot compare offers easily.

A spokesman for IAG told insuranceNEWS.com.au the company believes insurance cannot be compared on price alone.

Claims experience is also important “and our focus is on making sure we fulfil our promises”.

A Suncorp spokesman says the UK Financial Conduct Authority is reviewing aggregators because of concerns about transparency and fairness, “specifically that consumers may not be receiving the best deal and can be provided with false expectations around coverage that are only exposed when they need to make a claim”.

“This lack of transparency is reflected in Suncorp’s own research, which found that 97% of consumers are unaware of the fee and commission structure aggregators employ.”

He says consumers can compare insurers’ offering by contacting companies or using the internet, which may encourage more consideration of whether the product meets their needs.