Watchdog warning on price comparison sites
Some price comparison websites are failing consumers, the City watchdog has warned.
It accused sites that compare insurance quotes of "failing to meet consumers' expectations of them and, in some cases, the FCA's regulatory standards".
It said the websites did not always ensure that consumers were given the information they need to help them make informed decisions.
By failing to provide clear information, the websites are increasing the risk that consumers may buy products without understanding whether they were getting the right cover or level of excess, for instance.
In particular the focus is put on headline price and brand when consumers should be made more aware of crucial product features such as policy coverage and terms.
The watchdog looked at 14 price comparison websites between December 2013 and April 2014 and found several areas of concern.
For starters the websites do not make clear their role, leaving some consumers mistakenly believing that the quotes were the best policy for their individual needs and that the site had assessed the suitability of the policy for them.
On top of that some sites owned by an insurer or broker do not disclose the potential conflict of interest, which is against FCA rules.
Clive Adamson, FCA director of supervision, said: "Our research found that price comparison websites are not meeting our requirements in delivering fair and consistent outcomes for consumers. We also found that consumers had a number of misconceptions about the services they provided."
He warned price comparison websites to take on board the findings of the review.
"It is important for consumers to understand that not all products are the same and the cheapest product may not always be the best for their needs," he said.
Hayley Parsons, founder of gocompare.com, said that the firm would be reviewing the findings of the FCA's report.