Defaqto has launched a new series of star ratings to help consumers determine the best product for them.

It hopes the ratings will encourage people to consider products based on features rather than price.

The system also helps advisers understand where a product sits within the wider market and gives a clear indication of the features provided.

Research by the firm questioned 3,000 people and found 49 per cent did not understand the features of the products they own and 23 per cent were worried about purchasing an unsuitable product.

Some 69 per cent saw price as a very important factor when choosing a financial product.

The new Defaqto system rates 40 different product types across credit cards, current accounts, general insurance, pensions and investments, life and protection and mortgages.

Products are rated from one to five dependent on the comprehensiveness of the product.

David Cartwright, Defaqto head of insight, said: “Finding a financial product that is right for you can be complicated and often confusing. It is essential that consumers match the features and benefits they require with those provided by the products they choose.

“The key is for people to look for the right level of product for their particular circumstances - whether this happens to be a one star product for someone who wants a basic product or a four or five star rated product for someone who has more comprehensive requirements.”