One in four motorists have been with their car insurer for more than a decade and have no intention of changing – but are they the ones paying extra for their loyalty?
New research by comparethemarket.com.au reveals 1 in 4 Aussie motorists are sticking with the same insurer for more than 10 years. But who wins when it comes to loyalty and does it pay to stay if it means you can pick your perks?
A new independent survey commissioned by leading car insurance comparison service comparethemarket.com.au revealed that nearly half (42 per cent) of Aussies have been with their insurer for more than 5 years, and one in four (24 per cent) for more than 10 years. The main reason respondents have stayed with their insurer for so long is that they believe they have the best deal (53 per cent). Yet, of the remaining 47 per cent that cite other reasons for sticking around, almost two-thirds say they can’t be bothered to shop around.
Spokesperson for comparethemarket.com.au Abigail Koch says that as base premiums rarely drop, insurers have to keep customers on the hook with special discounts, promotions and incentives.
The survey revealed that of the 47 per cent of motorists who stay with their insurer for reasons other than having the best deal, 36 per cent do so because they have always been with that company and 23 per cent simply can’t be bothered to change. Younger Aussies top the apathy charts with almost half of drivers (43 per cent) aged between 20 and 29 saying this is the main reason they stay. This compares with only 29 per cent of 30 year olds, 30 per cent of 40 year olds, 25 per cent of 50 year olds, and 16 per cent of 60 year olds.
Abigail says: “Many insurance companies don’t include your old premium on your renewal letter – they just tell you the new price – which can make it difficult to work out how much extra you’ll be paying. This is why it is important to dig out last year’s premium and compare it with the new amount. If the cost has gone up, call your insurer and ask why. If they don’t give you an adequate answer then it might be time to look for a better deal.”
According to the data, Aussies say that incentives such as roadside assistance and free hire cars do influence them to stay with an insurer (49 per cent and 32 per cent of respondents respectively). The data also reveals, however, that what really influences them to stay are annual discounts on premiums (79 per cent of respondents).
Abigail says: “While features such as free hire car appear attractive on paper, as your premiums go up each year, that ‘free’ hire car might not seem as good value. Separate your ‘needs’ and ‘wants’, and you could find a policy that better suits your lifestyle and your budget.”
A third of Aussies cite lifestyle rewards (30 per cent), such as free/discounted cinema tickets and dining vouchers, as a key factor in their decision to stay with one insurer. However in reality, only 10 per cent say it is the main reason they stay.
“Another key pain point for motorists is if they have a difficult claims experience when they go to claim on their car insurance. According to research by the Financial Ombudsman Service, there were seven disputes per day in 2014/15 regarding car insurance. So, if you don’t believe the service you’ve received has been up to scratch, then it’s time to compare other options,” added Abigail.
For further information or for an interview with Abigail Koch, please contact:
Hannah Twiggs, PR Assistant, comparethemarket.com.au
Tel: 07 3377 8879
Comparethemarket.com.au is a comparison website that makes it easier and quicker for Australians to compare and buy products and services they rely on in their everyday lives. Whether you’re looking for a good deal on your car insurance, health cover for you and your family, the lowest fuel prices in your area, or an energy provider that suits your needs, then go to comparethemarket.com.au. It’s a completely free service and enables Australians to make purchasing decisions with greater knowledge, confidence and savings.
 Pure Profile survey conducted in April 2016 with 1,200 participants.