1st February 2011
Defaqto launches star ratings for 2011
According to research by independent financial research company Defaqto:
- 94% of consumers compare the features of different products when choosing a financial product; and
- 86% of people see independent ratings as an important factor when making a decision.
Price will always play an important role in consumers’ decision making. However, a feature-led approach to product development, marketing and advice by product providers and intermediaries is likely to result in a better match between what someone needs from a financial product and the product they end up buying.
Defaqto’s Star Ratings help firms understand the overall level of features and benefits offered by the different products on the market - and the independent financial research company has today published its Star Ratings for 2011.
Star Ratings provide an independent assessment of all products across more than 40 different product types within the following areas:
- Credit cards
- Current accounts
- General insurance - including home, motor, pet and travel insurance
- Investments
- Life and protection
- Mortgages
- Pensions
Taking a wide range of features and benefits into account, Defaqto gives each product a rating from 1 to 5 depending on how comprehensive they are.
Star Ratings help firms by:
| Product providers | Intermediaries |
| Helping providers differentiate and promote their products on features rather than price | Supporting intermediaries’ recommendations by giving a clear indication of the features provided by products they select for clients |
| Enabling providers to demonstrate openness about the quality and standard of their products’ features, resulting in an honest and trusted brand | Providing an unbiased view on the quality and standard of a product, allowing intermediaries to understand where a product sits within the wider market |
| Increasing confidence and understanding of where products are positioned in the wider market, with intermediaries among others | Complementing intermediaries’ product selection process by enabling them to group products easily based on the level of benefits they offer |
Brian Brown, Defaqto’s Head of Research, said:
“It is essential that consumers match the features and benefits they need with those provided by the products they choose. If people focus on price alone they can run the risk of buying an inappropriate product that doesn’t meet their needs – and they are only likely to discover this when it’s too late.
“Our Star Ratings help product providers and intermediaries understand the overall level of features and benefits offered by a wide range of products. They can help providers take a feature-based approach to developing and positioning their products, and support the recommendations advisers make to their clients. Ultimately, Star Ratings aim to help people identify the right level of product for their particular circumstances – and they support the industry in helping consumers achieve this.”
Firms can visit www.defaqto.com/star-ratings to access this year’s ratings.
And new for this year, Defaqto’s enhanced Star Ratings website enables users to:
- Find 1, 2, 3, 4 or 5 Star Rated products and compare their features and benefits with each other
- Identify which Star Rating their current product has, enabling a judgement to be made about whether it is the right level of product for their requirements
- Access information about all Star Rated products so they can learn more about what they offer and how Star Ratings are calculated
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