# "Offer applies to new customers only"



## Brendan Burgess (26 Feb 2014)

I heard an ad for car insurance on the radio offering a 10% discount, but to new customers only. 

Some lenders, e.g. ptsb, have lower rates for lower Loan to Value mortgages, but they don't apply to existing customers. 

Other lenders used to give a discounted rate for the first year of the mortgage. 

When looking at Laya health insurance recently, one plan was €3,600 and another was €5,100 but I could not see any difference. When I rang Laya, the guy told me that there was no difference,but that the more expensive plan was an older plan.  I understood this to mean that some customers just renew automatically and so pay a much higher price for their failure to shop around. 

 There have been shocking examples in the UK of house insurance companies renewing policies at £1,200 but when the insured rang the company pretending to be a new customer, they got quotes of £300. 

*What would happen if a  financial services provider decided to reward loyalty rather than new business? 

*Let's say that ptsb told its customers that customers who have paid their mortgage on time and now have less than 50% LTV will pay a lower rate to reflect their much reduced risk. 

Or a pensions provider guaranteed to give its retiring customers the best annuity rate available. 

Or an insurance company gave a 10% discount to loyal customer on top of any no claims discount. 

Surely it's easier and cheaper  to keep existing customers than to win new customers? 

Or do they just do a calculation that inertia  is such that they can squeeze more money out of existing customers?


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## Shallow Hal (26 Feb 2014)

Shop around is the only answer...i think all these institutions have the same attitude...hoping that the consumer doesn't have time on their hands to search online or make calls.


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## vandriver (26 Feb 2014)

I have sadly come to the conclusion that Irish companies simply don't value loyalty,so change car insurance,utilities etc every year.


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## RainyDay (26 Feb 2014)

UPC are encouraging me to switch to Sky by offering 6 months half price to new customers. So I should switch to Sky for 12 months, and then switch back, leaving UPC down 12 + 6/2 months revenue, instead of just giving me the best deal now when they would be down 6/2 months revenue.


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## ontour (26 Feb 2014)

Many existing customers will remain without any reward for their loyalty.  The cost of rewarding them all outweighs the loss of a few switching.

Competition will offer short term benefits that attract the customer for '10% off in the first year'.  Most customers believe that they will take this offer and have the discipline to repeat this switch every year.  For the majority, this belief is not matched by their action the following year.


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## Sue Ellen (26 Feb 2014)

RainyDay said:


> UPC are encouraging me to switch to Sky by offering 6 months half price to new customers. So I should switch to Sky for 12 months, and then switch back, leaving UPC down 12 + 6/2 months revenue, instead of just giving me the best deal now when they would be down 6/2 months revenue.



Rainyday,

Not like you, not to haggle


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## RainyDay (26 Feb 2014)

Sue Ellen said:


> Rainyday,
> 
> Not like you, not to haggle



Working on it!


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## BillK (11 Mar 2014)

Similar situation here in England. What price loyalty?


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