Loyalty Tax Statistics Australia 2026: Every Sector Compared

Australian utilities loyalty tax costs households a combined $6.7 billion per year, and that figure doesn't even count mortgages or savings accounts (Finder, 2025). The problem isn't just the scale. It's that loyalty tax statistics are scattered across ACCC reports, insurer disclosures, and industry trackers. No single Australian source tracks all six sectors in one place. This page does exactly that. Every statistic is sourced, every sector is covered, and the data is updated quarterly for 2026.

If you've never heard of loyalty tax before, start here first.

For a full breakdown of how the mechanism works in each market, read our Loyalty Tax in Australia: The Complete Guide.

TL;DR: Australian loyalty tax costs the average household $500-$1,500 per year across six sectors. Utilities alone cost $6.7 billion annually (Finder, 2025). Most surprisingly, mortgage holders with loans 5-10 years old pay 71 basis points above new-customer rates, adding thousands per year in hidden interest (Finspo, 2025).

What Is Loyalty Tax, and How Is It Measured?

Loyalty tax describes the price gap between what new customers pay and what long-term customers pay for identical products. In Australia, the average household loses $500-$1,500 per year across energy, insurance, mobile, broadband, mortgage, and savings accounts (eTax.com.au, 2025). It's not a formal charge. It's the silent outcome of staying put while providers quietly reserve their best rates for new sign-ups.

Measurement varies by sector. Regulators like the ACCC compare existing-customer standard rates against advertised new-customer offers. Industry trackers like Finder and RateCity survey published rates across provider sets. Academic researchers compare switching behaviour against pricing outcomes in energy markets. Each method has limitations, which is why the data across sectors doesn't always align neatly.

For the full explanation of how the mechanism works in each market, see Loyalty Tax in Australia: The Complete Guide.

Citation capsule (Key Findings): Australia's loyalty tax across utilities (energy, mobile, broadband) costs households a combined $6.7 billion per year, with the average household losing $500-$1,500 annually (Finder, 2025; eTax.com.au, 2025). When mortgage and insurance costs are added, the total burden for a homeowner across all sectors easily exceeds $2,000-$5,000 per year.

Energy Loyalty Tax Statistics (2026)

Australians lose over $4 billion per year to energy loyalty tax, with households on electricity plans older than three years paying an average of $221 more annually than customers on newer plans (ITBrief, 2025; ACCC, December 2025). That's not a rounding error. It's the compounding cost of doing nothing.

As of December 2025, the ACCC reported that 37% of residential electricity customers, approximately 2.5 million households, were paying at or above the default market offer (ACCC, 2025). More than 400,000 of those customers were paying 10% or more above the default. NSW households have been hit especially hard: electricity bills rose 9% between August 2024 and August 2025, compared to a national average of 6% (ACCC, 2025).

The switching picture is improving, though. The proportion of customers on electricity plans less than 12 months old jumped from 29% in August 2024 to 42% by August 2025, a 13-percentage-point gain in a single year. NSW's disclosure legislation appears to be accelerating the trend. NSW households that do switch can save up to $300 per year on comparable plans. The ACCC's final determination on switching improvement measures is due in December 2026.

Why are 2.5 million customers still paying above default despite this improvement? Inertia plays a role. So does the complexity of comparing energy plans across retailer websites. The ACCC's data shows that awareness alone doesn't close the gap. Structural disclosure requirements do.

Citation capsule (Energy): As of December 2025, 37% of Australian residential electricity customers, roughly 2.5 million households, were paying at or above the default market offer, with households on plans older than three years paying an average of $221 more annually than those on new plans (ACCC National Electricity Market Inquiry Report, December 2025).

Insurance Loyalty Tax Statistics (2026)

Australia's insurance loyalty tax costs the market an estimated $3.6 billion per year, with renewing policyholders paying 34% more than new customers in years two and three of their policy, affecting more than 10 million Australian households (SmartCompany, 2025; ACCC Insurance Monitoring Report, 2023; Accounts NextGen, 2025). That 34% gap isn't a market anomaly. It's a documented pricing strategy.

CHOICE research found that 87% of Australian home insurance policyholders received a higher premium at their last renewal, and 88% stayed with the same insurer anyway (CHOICE, 2024). Nine in ten got a price rise, and nine in ten paid it without switching. That's the behaviour insurers price around, and it's less about apathy than about comparing cover being a slog. Adding pressure: home insurance premiums have climbed 51% over the past five years (Insurance Business, 2024).

Regulatory enforcement has intensified. IAG was fined $40 million, RACQ was fined $10 million, and QBE faces ongoing ASIC proceedings, all related to loyalty pricing practices. Enforcement is real. As the CHOICE data shows, it hasn't shifted policyholder behaviour much yet.

Citation capsule (Insurance): Australian home insurance policyholders who renew with their existing insurer pay an average of 34% more than new customers in years two and three, contributing to an estimated $3.6 billion annual loyalty tax burden across the insurance sector (ACCC Insurance Monitoring Report, December 2023; SmartCompany, 2025).

Mobile and Broadband Loyalty Tax Statistics (2026)

Australia's mobile loyalty tax costs the market an estimated $2.8 billion per year, with the average customer paying $54 per month for a plan that's available to new customers for $42 per month, a $12/month loyalty premium adding up to $144 per year in unnecessary overpayment (Finder, 2025). Broadband adds another $986 million to that national tally. Combined, the telecom loyalty tax burden across mobile and broadband reaches $3.786 billion annually.

The mobile market moved fast in 2025. Twenty-five of 46 NBN providers changed their pricing during the year. NBN Co also rolled out free speed upgrades. Eligible customers on NBN 100 plans could access NBN 500 speeds from September 2025 at no extra cost. Existing customers who didn't check their plan status ended up in a doubly disadvantageous position: paying a loyalty premium on a plan that was also technically inferior to what they could have had.

Broadband overpayment ranges from $16 to $445 per year depending on the speed tier and how long the customer has been on their current plan. The higher end of that range applies to customers on premium speed tiers who haven't reviewed their plan in over two years.

Stat spotlight: Australia's combined mobile and broadband loyalty tax totals $3.786 billion per year, more than the national insurance loyalty tax burden and second only to energy. (Finder, 2025)

Citation capsule (Mobile & Broadband): The average Australian mobile customer overpays by $12 per month ($144 per year) compared to the best new-customer rate for an equivalent plan, contributing to a national mobile loyalty tax of $2.8 billion annually. Broadband adds $986 million. Combined, telecom loyalty tax totals $3.786 billion per year (Finder, 2025).

Mortgage Loyalty Tax Statistics (2026)

Australia's mortgage loyalty tax rate gap peaked at 51 basis points in December 2024, then narrowed to an average of 21 basis points by August 2025 following three RBA rate cuts that brought the cash rate to 3.6% (RateCity, 2025). That narrowing sounds like good news. But it masks enormous dispersion.

Borrowers with loans aged 3-5 years are paying 58 basis points above the best new-customer rate. Borrowers with loans aged 5-10 years are paying 71 basis points more (Finspo, 2025). On a $600,000 mortgage, that's approximately $3,480 per year extra for the 3-5 year group and $4,260 per year extra for the 5-10 year group. The average gap figure of 21 bps tells you almost nothing about what you personally are paying.

Some lenders passed on less than the full RBA rate cuts to existing customers while giving new borrowers the full reduction, widening the gap for long-term holders even as the headline average improved. The number that matters for any borrower is the rate the lender is advertising to new customers today. For anyone 3+ years into a loan, that figure is often a surprise.

Citation capsule (Mortgage): Australian mortgage borrowers with loans aged 5-10 years pay an average of 71 basis points above the best new-customer rate, approximately $4,260 per year extra on a $600,000 loan. The aggregate rate gap peaked at 51 basis points in December 2024 and narrowed to 21 basis points on average by August 2025, though dispersion by loan age remains extreme (Finspo, 2025; RateCity, 2025).

Who Pays the Most Loyalty Tax in Australia?

Lower-income and elderly Australians face the heaviest loyalty tax exposure because they switch providers the least. Peer-reviewed research published in the Energy Policy journal found that lower socioeconomic status is directly correlated with lower switching rates across energy markets, meaning loyalty tax operates as a regressive cost that falls hardest on those who can afford it least (ScienceDirect / Energy Policy, 2022).

Cross-sector cumulative burden (a figure no other Australian source has published):

A low-income household paying loyalty tax across all four quantified sectors simultaneously faces a minimum annual burden of approximately $965 per year: energy ($221) + insurance ($400, conservative estimate) + mobile ($144) + broadband ($200). This calculation draws from sector estimates rather than a single surveyed household. See the Limitations section for caveats. For homeowners 5-10 years into a $600,000 mortgage, adding the mortgage loyalty tax brings the total to well over $5,000 per year.

Regional and rural Australians face an additional layer of disadvantage. Fewer provider options mean less competitive pressure on loyalty pricing. Customers with disabilities face additional friction in the switching process itself, navigating comparison tools, call centre retention scripts, and documentation requirements that able-bodied customers may find merely annoying.

Citation capsule (Vulnerable groups): Lower socioeconomic status is directly correlated with lower switching rates, meaning loyalty tax falls disproportionately on lower-income Australians across the energy sector and likely across insurance, mobile, and broadband as well (Energy Policy, ScienceDirect, 2022). A low-income household paying loyalty tax across all four quantified sectors faces a minimum annual burden of approximately $965 per year.

Surprises and Outliers in the 2026 Data

Surprise 1: Energy switching is improving faster than expected.

The proportion of customers on plans less than 12 months old jumped from 29% (August 2024) to 42% (August 2025), a 13-percentage-point gain in 12 months. Analysts anticipated incremental improvement. NSW's disclosure legislation appears to be accelerating the trend beyond what ACCC modelling had projected. It's one of the few genuinely positive data points in the 2026 loyalty tax picture.

Surprise 2: The mortgage gap has narrowed significantly but unevenly.

The average gap dropped from 51 bps to 21 bps. That sounds like progress. But borrowers with 5-10 year loans still face 71 bps above new rates. The average conceals a massive dispersion: the longer you've held your loan without renegotiating, the worse your position. No lender is going to call you to point that out.

Surprise 3: Insurance enforcement has intensified without improving consumer outcomes.

Three major enforcement actions, IAG ($40M fine), RACQ ($10M fine), QBE (proceedings ongoing), occurred within two years. Yet CHOICE's 2024 data shows 88% of policyholders still don't switch when premiums rise. Fines penalise past conduct. They don't change the structural dynamic that makes loyalty pricing rational for insurers.

Our March 2026 spot-check found insurance loyalty tax operating much as the ACCC described. The new-customer rate for one major insurer was 28% below our existing-customer renewal quote for equivalent coverage. That gap hadn't narrowed since the enforcement actions began. The fines weren't large enough, or quick enough, to shift pricing behaviour.

What the Data Means in Practice

The data is clear. Numbers only matter once something acts on them. Here's what acting looks like, by sector, and where we take it off your hands.

By sector:

1. Energy: Anyone on the same electricity plan for three or more years is likely among the 37% paying at or above the default offer. The gap shows up against a new-customer rate on a comparable plan, and NSW households can be up to $300 a year over the odds. We run that check and move you across.

2. Insurance: Against a new-customer quote for equivalent cover, the renewal gap is usually plain. Where it's more than 10% over, a call to the retention team tends to close it. That call is one we make.

3. Mortgage: The same gap sits against the rate lenders advertise to new borrowers, averaging 58 bps for longer-held loans. Home loans aren't something we act on today, so this line stays yours for now. We've kept it in because it's usually the biggest one.

4. Mobile: The $12 a month overpayment is the most fixable item on this list. An equivalent plan is usually a sub-15-minute switch, with no change of number.

One more thing on scale:

Across sectors, the combined loyalty tax burden on a single household can run $2,000-$5,000 a year once a mortgage is in the mix. That's the compounding effect of small gaps across several bills, over several years. It's a real number, not a rounding error, and it's exactly the sort of recurring admin that never reaches the top of the list.

Conclusion

Australia's loyalty tax problem is big, persistent, and unevenly spread. The six sectors covered on this page carry a combined quantified annual cost well above $10 billion, with the real figure likely higher once savings accounts are properly tracked.

The takeaways for 2026: energy switching is improving but 2.5 million customers still overpay; insurance enforcement hasn't shifted consumer behaviour; mobile is the easiest loyalty tax to fix; mortgage holders with older loans face the largest per-household dollar cost; and lower-income Australians are systematically the most exposed.

The catch in all of it is the same: knowing the gap is one thing, closing it across every bill, every year, is another. That's the work. We do it. Resunday checks your bills, rates, and plans, finds the better deal, and moves you onto it. You say yes once, and stop thinking about it.

For more detail on individual sectors, read the Loyalty Tax in Australia: The Complete Guide.

Last updated March 2026. Next update: July 2026.

signed, resunday.