NMa: shopping around for financial products pays off

Shopping around pays off, even for financial products, such as health insurances, car insurances or mortgages. Price differences are much larger than most people think. The Netherlands Competition Authority (NMa) has identified 15 of the most popular financial products consumers take out, and it calculated how much consumers could save by shopping around.

The NMa’s calculations reveal that a retired couple could save almost EUR 650 per year, and that a young couple with two children could save up to EUR 1,000 per year.

The NMa has calculated the potential savings for eight household types. Each household type takes out a different mix of financial products. Total savings could be substantial, potentially thousands of euros, since financial products are often taken out for longer periods of time. Savings could be significant for individual financial products as well. On mortgages, for example, consumers could save between EUR 300 and 400 per year, depending on the type of mortgage. In some cases, consumers could even save up to EUR 800 per year. The NMa found out that, for some products (multi-trip travel insurances, personal-property insurances, and building insurances), the price of the highest provider can be twice as high or even triple as high as the price of the lowest provider.

‘Particularly in tough economic times, it is good to know that shopping around can save you money. Consumers play a crucial part in that context, because by shopping around wisely, they stimulate competition between companies. If consumers do not exert any pressure, companies will innovate less, and prices could be higher,’ explains Henk Don, member of the Board of the NMa.