An insurance promotion offering Prezzy cards for taking out new policies is prompting fresh scrutiny of how incentives for new business sit alongside pricing for existing customers in New Zealand’s general insurance market, at a time when many households are dealing with higher premiums. Broker Glenn Marshall, speaking with RNZ in a personal capacity as a consumer, has complained to IAG about a recent campaign across several of its brands in which people taking out new insurance cover were offered $200 Prezzy cards.
Marshall said the structure of the offer meant customers moving to, or between, brands could access benefits that renewing policyholders were unlikely to receive. “My wife and I own our own home, have no mortgage and savings. However, many households and pensioners are already struggling with premium increases. Promotions that reward churn – and effectively penalise loyalty – shift costs on to renewing customers,” he said, as reported by RNZ.
According to Marshall, IAG told him the Prezzy card offer was not a discount on premiums but an incentive for new business that could be accessed by both new and existing customers who initiated additional cover. He has also raised his concerns with the Financial Markets Authority (FMA). A spokesperson told RNZ the regulator is aware of the promotional activity and is monitoring such offers. “These types of promotions do not in themselves create concerns for us. They can support healthy competition by encouraging customers to shop around and choose the provider that best meets their needs. If consumers have concerns about any offer or promotion, they are welcome to contact us,” the spokesperson said.
Consumer NZ insurance spokesperson Rebecca Styles said Prezzy‑type incentives align with a pattern of offers aimed at attracting new or switching customers and reinforce its concerns about a “loyalty tax” for policyholders who do not regularly review their cover. “It does highlight that existing customers are likely missing out on those deals, in what’s called a loyalty tax. We find in our surveying that most people set and forget insurance. We would encourage people to shop around and take advantage of these deals, providing that when they switch, they’re getting a good deal on their premiums and the policy details make sense for their circumstances,” Styles told RNZ.
Styles said Consumer NZ’s sentiment tracking shows insurance has become a more prominent source of financial pressure, alongside housing, food, and debt, as premiums for house, contents, motor, and health insurance have increased. “Insurance is meant to provide a safety net, but for many people, it’s becoming increasingly difficult to access. When you add the complexity of policies and the lack of transparency, it’s easy to understand why trust in the industry is falling,” she said.
Survey work commissioned by the Insurance Council of New Zealand Te Kāhui Inihua o Aotearoa (ICNZ) indicates that, despite cost pressures and periodic new‑business offers, many policyholders remain with the same provider over long periods. The 2025 research found that 20% of respondents had changed insurer in the past two years and 34% over the last five years, while 32% said they had never switched. About 21% reported that they routinely compare options when their cover comes up for renewal, compared with 25% who said they never shop around.
According to the survey, younger customers were more likely to have changed insurer recently, while older customers were less inclined to move. Those who had switched in the last two to five years were more likely to be Wellington residents and in households with incomes between $50,000 and $100,000. More than half of insured respondents had contacted their insurer about their cover in the previous two years outside of claims, but 16% said they had never contacted their insurer.
Consumer NZ’s latest tracking suggests insurance is becoming a larger line item in household budgets, with many respondents linking premium changes to broader cost‑of‑living pressures. The same research shows a fall in trust in the sector, with more people now saying they distrust insurers than trust them, alongside declining confidence in other sectors such as healthcare and energy. Consumer NZ has said this pattern points to a need for greater clarity about pricing, coverage and claims outcomes. Climate risk is also influencing availability and cost, particularly in higher‑exposure locations. Some policyholders in those areas report higher premiums or difficulty obtaining cover, raising questions about insurance gaps and community resilience.
