Supermarkets admit insurance benefits of brand loyalty
Car insurance is cheaper for weekly shoppers, Tesco and Sainsbury’s have admitted. The supermarkets revealed that they use data about customers’ shopping habits when setting prices for their financial services.
Both retail giants amass huge volumes of customer data, which their financial divisions can then access when setting prices across a range of deals. But critics say the use of this type of data is “intrusive” and question its relevance to the likelihood of a policyholder making a claim.
James Daley, founder of Fairer Finance, said: “Why should a car insurer need to know when and where you shop in order to give you a quote? It’s got nothing to do with how well or safely you drive.”
While there is no suggestion that either supermarket is breaching data rules, Simon Morrissey, head of data and privacy at law firm Lewis Silkin, voiced concern over the transparency of the use of personal data.
“Consumers are unlikely to have read fully all the detailed small print about how their data might be analysed and used,” he said.