Andrew Wiseman dissects what real loyalty looks like in the new post-GIPP world of insurance and explores how brands can move beyond compliance to build trust, fairness and genuine long-term value.
When the FCA banned the loyalty penalty, it was meant to end a very familiar ritual. You know, the price comparison website hit that you hoped would save you a few quid?
For years, the motor insurance market had trained people to shop around at renewal, to chase a cheaper price that rarely lasted more than a year. We all knew the routine. One insurer wins you with a low first-year rate, only to nudge the price up at renewal. Rinse and repeat.
The FCA’s rule change was designed to stop this so called ‘price walking’. Renewal prices must now be fair, and in theory, you shouldn’t pay more just because you stayed loyal.
And it worked. At least to some extent. The renewal merry-go-round has slowed. Customers are switching less often. But that doesn’t mean price has disappeared as a motivator. It’s still the biggest factor; it’s just changed its role in the story.
Price is still king — it’s just less dominant
According to research for Insurance Times, price remains the main reason motorists switch insurers. No surprise there. But the difference now is how much it takes to tempt them.
Before the rule change, a £20 or £30 saving was enough to get people seriously thinking about switching. Now, with renewal and new-business prices more closely aligned, that same saving no longer feels worth the effort. Price has shifted from being a trigger to being a threshold. You still need to be competitive to be considered. But it’s not the only thing that matters.
And let’s not ignore where these decisions are made. Price comparison websites are often the default starting point for many motorists. They are the shop window for the industry. Appearing on that first screen remains critical, but the dynamics have evolved.
For insurers, this creates a tension. Compete too aggressively and you risk joining the race to the bottom. But play it safe, and you vanish from the customer’s search results. In a post–loyalty penalty world, building trust in the overall package becomes more important. Showing your product with clarity of what’s included (and what isn’t) is critical in building perceptions of fairness and trust.
So, if it’s not price, what else drives a switch?
When Insurance Times asked customers why they switched, around one in five said it was to get better cover, and about one in ten said they were unhappy with their current terms. That feels important. It shows that, while price dominates, other factors are starting to play greater roles. People aren’t just looking for cheaper; they’re looking for better. Better cover. Better communication. Better treatment.
At Mustard, we’ve written before about how incentives can shape perceptions even when no one switches. The same logic applies here. When insurers show fairness or generosity, it creates a halo effect. It tells customers something about who you are – and that impression sticks, even if they stay put for now.
The loyalty hidden in claims
One of the most overlooked loyalty levers in motor insurance is a positive claims experience. There’s nothing new here, it’s come up in countless insurance research projects that I’ve worked on over two decades.
When a customer has a claim handled quickly and fairly, it can transform the relationship. It’s often the only real moment of truth they have with their insurer. Get it right, and you can secure loyalty for years. Get it wrong, and they’ll be gone at the next renewal — no matter what the price says. There’s something very human about this. We all remember how we were treated in moments of stress. The fairness of that experience colours everything that comes after.
So, where does that leave insurers?
The loyalty penalty ban didn’t remove competition. It made competition smarter. Price will always matter, but it’s no longer the only story in town.
Insurers now need to build loyalty around trust, clarity and fairness. To show value in ways that go beyond the cheapest quote.
Because when price stops shouting quite so loudly, customers start listening to everything else. How fair you are. How transparent you are. How you behave when they need you most. That’s what real loyalty looks like in this new world.