Dutch consumers who stay with the same insurance company have a strong risk of paying a “loyalty penalty”, according to new research.

A study of two identical clients who had been with an insurance company for either two years or at least nine years found that in almost half of cases, the long-standing customer would be charged more by a Dutch insurer, despite having the same risk profile.

The Dutch Authority for the Financial Markets (AFM) conducted the study with 31 insurers and five insurance products – analysing a total of 47.7 million private car, home contents and liability insurance policies between 2021 and 2023. It was inspired by similar research on “personalised” profit margins in the UK and in Ireland.

At a briefing in Amsterdam on Tuesday, AFM experts said Dutch insurance companies may well be breaking European laws on the “fair and careful treatment of customers”. In a press release, the AFM said: “Potentially vulnerable consumers who rarely or never switch can be at a disadvantage, particularly individuals with limited digital skills.”

Almost half of the insurers (47%) charged their most loyal customers higher premiums, particularly with car insurance. The profit margin from loyal customers was often more than 10%, comparing a hypothetical client of one to two years to one of more than nine years. The only type of insurance where loyal customers were treated the same or better than relatively new ones was for liability insurance.

In one example, which the AFM produced, a customer of two years called Thomas was paying an annual premium of €750, while Yara, who had been a client for 10 years, was charged €900 – a loyalty penalty of €150.

An AFM expert said the body would be entering discussions with insurers, investigating whether they have broken European law and considering whether the Netherlands needs stronger regulation. “It’s potentially more than a few hundred people [paying the loyalty penalty] given that most people in the Netherlands have insurance,” he said.

In 2022, the UK’s Financial Conduct Authority banned insurance companies from giving new customers lower quotes than customers making renewals for home and motor insurance. It also brought in new rules to make it easier for consumers to cancel auto-renewals and increased scrutiny of insurers.

At the AFM meeting, where the regulator also released its 2024 annual report, board chair Laura van Geest said that America was no longer a place of economic exceptionalism. “To us, the actions of the United States really feel like a turning point – a farewell to free trade as a guiding principle,” she said.

“And that is of course difficult to grasp for a trading nation like the Netherlands…It feels as though the US is turning its back on globalisation.”

Hanzo van Beusekom, AFM board member, called the turmoil on financial markets this week “a live stress test that is still running”.