The experience was exceptional. They patiently answered every question I had, explained a system I barely understood, and made me feel like more than just another customer. When we later moved into our first home, my account rep was my first call. Renewals came and went, and I never questioned them. I wasn’t really buying insurance anymore; I was buying certainty.
Then, one evening I saw an advertisement for an online insurer. I almost ignored it. Why would I price shop when I already trusted the person looking after me? But curiosity got the better of me.
I completed the online quote expecting nothing more than confirmation that I was in the right place. Instead, the premium came back roughly 30% lower than what I was paying. I called my account rep the next day expecting her to match it. She couldn’t. In fact, she admitted that if she were in my position, she’d probably switch too. And so I did.
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When loyalty becomes autopilot
My first reaction was to look for someone to blame. I had heard enough about the ‘loyalty tax’—the frustrating reality that new customers are often offered better prices than existing ones. It seemed like the obvious explanation. In industries such as insurance, telecommunications, and subscriptions, the practice of offering attractive introductory pricing before gradually increasing renewal prices is so common it even has a name: price walking.
But the more I looked into it, the less it explained what had happened to me. This was not a case of my broker penalizing me for being loyal. It was simply the difference between a brick-and-mortar provider and an online one—a fair reflection of two different business models. The more interesting question was not why the industry does this, but why I had reached for that explanation so quickly when the real story was so much closer to home.
Nobody tricked me into renewing, and nobody hid the better price from me either. It had likely existed for years. I simply never asked, and when I finally did, nothing about my situation had changed except my attention.
What I had mistaken for loyalty was really autopilot.
Knowing isn’t the same as acting
Behavioural economists describe this tendency as status quo bias. We naturally favour what we’re already doing because changing feels like work, even when the evidence suggests we’d be better off making the switch.
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That explanation resonated with me because I couldn’t hide behind ignorance. I negotiate almost everything. I genuinely enjoy finding value, and friends often joke that I could write a book on how to never pay full price. Yet, I had been overpaying for years.
It made me wonder where else the same blind spot was hiding. I suspect I could save money in so many places, the same way I once joyfully price matched and now rarely bother.
The irony isn’t that I don’t know better, it’s that I do.
The second lesson
I thought that experience had been a turning point. Then, a few months ago, a friend told me he had recently reviewed his car insurance policy, removed some redundant coverage, and meaningfully reduced his monthly premium.
I should have gone home and reviewed my own policy again. I didn’t.
My honest reaction was surprisingly underwhelming. I had already optimized it once, and doing it again felt like a chore, which bothered me far more than the overpaying ever had.
Every time I finally call a telecom provider or negotiate a bill, the conversation is almost always easier than I imagined. But the next time, my brain tells me the same story: ‘I can’t be bothered.’ Maybe that’s the real cost. Not the money itself, but the emotional friction we attach to making a decision.
The cost of life on autopilot
The Competition Bureau of Canada once surveyed Canadians who had recently switched or renegotiated their telecom, banking, and insurance plans, and found they saved roughly $1,860 a year, combined, by doing so.
