The Role of the Car Insurance Broker
In the UK car insurance is avoided by around two million road users even though it is a legal enforcement. This makes the quest for gaining car insurance even more expensive so you must be aware of all the options available to you before you even start looking for quotes.
Before the internet had evolved, motor vehicle insurance was gained purely from car insurance brokers. A broker is a unit or shop if you like that is dedicated to find you the best insurance wether it be for a car, home or life.
The car insurance broker is electronically linked into several insurance companies and can enter a customers details in once and retrieve a quote from all of these companies in an instant.
Over the last two to three years, the car insurance brokers role has rapidly declined due to the internets highly competitive market in the same area. Each car insurance company now has the ability to openly pitch their sale on the internet using methods such as these:
- Pay per click advertising
- Generic Search Engine Marketing
- Affiliate Marketing
Pay per click advertising
Pay per click advertising commonly known as PPC is a massively competitive market. What it involves is each company bidding on keywords such as cheap car insurance or car insurance uk to appear at the top of the search engine listings. The higher the companies bid, the closer to the top of the list they become which gives them far more chance of being displayed and clicked upon by a user requiring cheap car insurance quotes. Sometimes these bids can cost in excess of £5 per click making some companies daily budgets for dragging in potential customers run into thousands of pounds.
Generic Search Engine Marketing (SEM)
Search Engine Marketing or SEM is again a hugely competitive market on the internet not just for insurance but for every possible thing you can think of. Unlike PPC generic SEM costs no money to advertise, however the better and more popular the website, the higher it appears in the standard search engine placemements. please note each search engine is different and it is unusual for the same website to appear top in all search engines.
Affiliates are people like you and me who happen to run websites that advertise the services of other companies. The cheap car insurance market is swamped with affiliate websites that can earn good money from supplying a simple link to the car insurance company. Affiliates also use SEM as a way to crawl to the top of the search engines and try and capture the users looking for car insurance – the higher they are, the more money they can earn (usually earning a fixed fee for a user taking out a policy with their affiliated company OR taking a percentage of the PPC fee). These affiliates are now playing the role of the car insurance broker on the internet, also with the other two methods above that the insurance companies use to gain customers, the old-fashioned car insurance broker must be feeling the pinch in this decade.
The above points have described the electronic car insurance broker unlike the highstreet shopfront. Over the next ten years I would expect some dramatic changes in numbers of old-fashioned car insurance brokers scattered around the UK however if they are smart, they will adapt and also be able to use the internet in some way as a tool to sell themselves and their services.