Car insurance and energy are most switched financial products of the decade – but we’re happy to stick with the same mortgage lender
- More than half have switched car insurer in last decade
- Three fifths have switched a financial product in the last year
- Switching providers can help customers crack down on the loyalty penalty
More than half of people switched car insurer in the last decade, research shows, making it the most switched financial product.
Proving that the 2010s was the decade households embraced switching, 80 per cent moved at least one financial product to a rival firm in the 2010s, according to data from Go Compare.
More than half said they were now more likely to switch providers to get a better deal than they were 10 years ago.
However, 39 per cent didn’t switch any of the most common financial products in the last 12 months.
Switch: Car insurance was found to be the most switched financial product of the decade
Go Compare looked at the nation’s switching habits in the last 10 years to mark the start of a new decade.
It compared the results it uncovered in its 2010 research with a survey it completed at the end of December 2019.
It found that car insurance was the most switched product, followed by energy provider with 50 per cent saying they had switched supplier, indicating a lack of loyalty in these sectors.
The same amount of households confessed to switching their home insurance and mobile phone providers with 48 per cent saying they had moved.
Other financial products that customers have switched include broadband and their current accounts, with 43 and 41 per cent changing, respectively.
Mortgages were the least switched product with just 13 per cent changing – this may indicate that mortgaged households are happy with their lender, are tied into longer deals, are happy to remortgage with the same firm or don’t want the rigmarole of moving.
Isas and savings accounts, along with credit cards were also low on the list of products people switched.
| Rank | Product/service switched in the last decade | % |
|---|---|---|
| 1 | Car insurance | 56 |
| 2 | Energy provider | 50 |
| 3 | Home insurance | 48 |
| 4 | Mobile phone provider | 48 |
| 5 | Broadband | 43 |
| 6 | Bank current account | 31 |
| 7 | Landline telephone | 31 |
| 8 | Credit card | 27 |
| 9 | ISA or savings account | 23 |
| 10 | Mortgage | 13 |
| Source: Go Compare | ||
This suggests a number of people could still be stuck on high tariffs with their providers as they have not moved to a cheaper deal.
However, the product that saw the biggest increase in switching activity over the last decade was energy which was up from nine per cent in 2010 to 21 per cent in 2019.
Mobile phones were also up from six per cent in 2010 to 17 per cent in 2019 and broadband was up from five per cent in 2010 to 14 per cent in 2019.
In the last year alone, 61 per cent of people switched at least one financial product or service compared to just 51 per cent in 2015, suggesting more consumers realise the savings that can be made by changing provider.
Car insurance typified this trend with 28 per cent switching in the last 12 months, compared to 19 per cent in 2015.
Loyalty penalty
Go Compare is campaigning for urgent action to be taken on insurance renewals to reduce the impact of loyalty penalties which could be affecting millions of insurance customers.
The comparison website is calling for the cooling-off period for auto-renewals to be doubled to 28 days, for insurers to do more to help customers understand their options at renewal and to provider clearer information on the price of cover.
It is also recommending limiting or banning cancellation fees for customers who switch during the extended cooling-off period.
Lee Griffin, chief executive of Go Compare, said: ‘The 2010s really were the “Decade of Switching” thanks to comparison sites, faster switching and greater intervention.
‘As a result, consumers are now much more likely to change provider to get a better deal than they were a decade ago.
‘Looking forward, we expect switching activity will continue to rise – partly due to the general economic uncertainty which continues around Brexit and potential price rises, and partly as a result of further regulatory moves to increase transparency and switching confidence.
‘We’ve got a huge opportunity now to improve things for the next generation of switchers.
‘The spotlight is well and truly on rip-off loyalty pricing tactics, which result in millions of existing customers paying more than new ones for the same cover.’
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