Lazy Aussies are paying too much on their financial products

LOYAL Australians are being cheated on by their insurers and financial institutions by getting slugged with a “lazy tax” for sticking with their providers.

LOYAL Australians are being cheated on by their insurers and financial institutions by getting slugged with a “lazy tax” for sticking with their providers.

Concerning new figures show health insurance customers are staying with their providers on average for nearly 12 years and missing out on enticing deals that new customers get for signing up.

And 40 per cent of consumers are still banking with the same financial institution they first banked with as a child, new analysis by financial comparison website finder.com.au has found.

But experts including Ipac financial planner Patrick Canion said loyalty means nothing and consumers should be actively looking for better financial deals at least every 12 months.

IPac financial planner Patrick Canion said consumers should review their financial products annually.

“Financial institutions absolutely rely on personal inertia,’’ he said.

“Loyal customers get taken advantage compared to new customers who sign up.”

Health insurance customers are about to be slugged an additional 4.84 per cent on average on their cover when the April 1 price hikes kick in which will increase many household premium by hundreds of dollars per year, while mortgage customers are also being stung with out-of-cycle rate hikes this month.

This week one of the nation’s largest lenders National Australia Bank announced it was increasing the variable rate deals for both owner occupiers and investors.

National Australia Bank was the first of the big four lenders to make out-of-cycle interest rate hikes this week.

They will hike the owner occupier standard variable rate by 0.07 per cent to 5.32 per cent and the investor SVR by 0.25 per cent to 5.8 per cent from next Friday.

And Westpac followed in their footsteps stinging customers across all variable rate deals between 0.03 per cent to 0.28 per cent on owner occupier and investor deals.

Finder.com.au data also revealed in the past five years customers admit they had never bothered to switch credit card providers and they are likely to be missing out on cheaper fees and charges on their cards.

The site’s spokeswoman Bessie Hassan said having a “set and forget” mentality with financial deals can be extremely costly.

Finder.com.au spokeswoman Bessie Hassan said customers should be aware their financial provider is unlikely to reward them for loyalty.

“In most cases, it’s unlikely a bank is going to reward your loyalty so the onus is on you as a consumer to stay on top of them,’’ she said.

“Whether it’s your health insurance, home loan, or credit card, there’s no point staying loyal to your bank if it’s costing you money or no longer meeting your needs.”

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Originally published as Lazy Aussies are paying too much on their financial products