Car insurance competition is healthy in Oz, says expert
There is a healthy degree of competition within the current Australian car insurance market, an analyst has suggested.
Robert Bryant, general manager of business information firm IBISWorld, noted that the major insurance "players" in Australia and their respective brands have become well known and have built up "many years of goodwill".
However, writing in a column for SmartCompany.com.au, Mr Bryant also claimed that there remains sufficient scope for smaller competitors to enter the market, thereby giving consumers greater choice when they come to compare car insurance and other insurance products.
"Many of these brands specialise in specific markets and in certain lines, which creates opportunities for some players to service a particular market niche," he said.
"Though the major players are fairly established, their collective market power has not constrained new entrants from being able to successfully enter the market."
Elsewhere, Mr Bryant argued that "the moderate level of barriers" has allowed non-traditional competitors who cross-sell financial services to customers to enter the market.
The comments came as the specialist predicted that Australia's strong economic growth would boost the demand for general insurance over the short-term, thereby prompting providers to increase prices.
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