Brokers 'looking for policies that pay decent commissions'

by Trevor Treharne10 Aug 2012

The latest simplistic evaluation of the value of an insurance broker claims that using a commission-hungry broker will result in paying $750 a year more in premiums.

A MoneyMail investigation has “found wallet-busting differences by using a broker”, but only compared with price comparison websites.

MoneyMail, who operate from the UK, but have posted their findings online to a global auidence, uncovered an overall annual hike of $750 a year more in premiums by using a broker, but made no mention of the value of the brokers’ services.

“This huge gulf – largely caused by insurance brokers’ added expenses – is punishing those who don’t have access to online comparison sites,” said MoneyMail.

Justin Modray, founder of financial advice site CandidMoney, added to the piece by stating: “A broker may do a lot of the legwork for you but they’ll be looking for a policy that pays them a decent commission.

“You’re also paying their wages, office costs and other overheads, which are usually higher than for a price comparison site.”

MoneyMail went on to suggest: “It’s impossible to know how much commission brokers get to recommend a particular policy.

“Our research follows on from countless letters by readers frustrated at ludicrous renewal quotes from firms, often when they have been a loyal customer for years.”