Source: Sharecast
The watchdog found that the price comparison website had breached competition law between December 2015 and December 2017 by imposing “most favoured nation” clauses on home insurance providers selling through its platform.
The clauses barred insurers from offering lower prices on other comparison websites, thereby ensuring Comparethemarket was not undercut by rivals.
The CMA said: “As a result, competition between price comparison websites, and between home insurers selling through these platforms, was restricted. The CMA found that this is likely to have result in higher insurance premiums.”
It has therefore fined Comparethemarket £17.91m.
Michael Grenfell, executive director for enforcement, said: “Price comparison websites are excellent for consumers.
“It is therefore unacceptable that Comparethemarket, which has been the largest comparison site for the home insurance for several years, used clauses in its contracts that restricted home insurers from offering bigger discounts on competing websites, so limiting the bargains potentially available to consumers.”
But Comparethemarket – which is part of the BGL Group – disputed the CMA’s findings.
The firm said it was “disappointed” with the decision and did not recognise the regulator’s analysis of the home insurance market.
The statement continued: “We fundamentally disagree with the conclusions the CMA has drawn and will be carefully examining the detailed rationale behind the decision and considering all of our options.”
The CMA launched the investigation in September 2017. In November 2017, Comparethemarket wrote to insurers to inform them it would no longer be enforcing most favoured nation clauses.
