Why do many people with Parkinson's disease develop an addiction? We built a virtual casino to find out

We knew people with Parkinson's disease were at heightened risk of developing addictive behaviours like gambling. Our research gives insight into why this is.From shutterstock.comParkinson’s dis...

Philip Mosley, Research Fellow, Systems Neuroscience Laboratory, QIMR Berghofer Medical Research Institute - avatar Philip Mosley, Research Fellow, Systems Neuroscience Laboratory, QIMR Berghofer Medical Research Institute

Up the creek: the $85 million plan to desalinate water for drought relief

The deal to crank up Adelaide’s desalination plant to make more water available to farmers in the drought-stricken Murray-Darling Basin makes no sense.It involves the federal government paying t...

Lin Crase, Professor of Economics and Head of School, University of South Australia - avatar Lin Crase, Professor of Economics and Head of School, University of South Australia

12 simple ways you can reduce bushfire risk to older homes

There are no guarantees in bushfires, but you can improve the odds your house survives a blaze.Photo by Edward Doody, courtesy of Arkin Tilt Architects, Author providedSeventy-five years of Australian...

Douglas Brown, Casual Academic, Western Sydney University - avatar Douglas Brown, Casual Academic, Western Sydney University

Robots with benefits: how sexbots are marketed as companions

Sexbot Emma, from AI Tech, is advertised as a "real AI you can talk to". She offers "warm hugs" and will "feel your feelings".YouTube/ScreenshotWhen thinking of sexbots, companionship might not be the...

Fiona Andreallo, Lecturer in digital culture, University of Sydney - avatar Fiona Andreallo, Lecturer in digital culture, University of Sydney

Holy bin chickens: ancient Egyptians tamed wild ibis for sacrifice

A scene from the Books of the Dead (based at the Egyptian Museum) shows the ibis-headed god Thoth recording the result of "the final judgement".Wasef et al./PLOS ONE, CC BY-SAThese days, not many Auss...

Sally Wasef, Postdoctoral research fellow, Griffith University - avatar Sally Wasef, Postdoctoral research fellow, Griffith University

Sonic havens: how we use music to make ourselves feel at home

Music played through headphones can immerse the listener in a more intimate experience.Stokkete/ShutterstockThe concept of “home” refers to more than bricks and mortar. Just as cities are...

Michael James Walsh, Assistant Professor Social Science, University of Canberra - avatar Michael James Walsh, Assistant Professor Social Science, University of Canberra

Nation-building to 'national shame': the ABC's complex debate over its role as sports broadcaster

ABC once viewed sports coverage as integral to its mission of nation-building. But in recent years, it has grown far more ambivalent about sports.Dean Lewins/AAPThe ABC has announced it will not provi...

Michael Ward, PhD candidate, University of Sydney - avatar Michael Ward, PhD candidate, University of Sydney

How does poor air quality from bushfire smoke affect our health?

New South Wales and Queensland are in the grip of a devastating bushfire emergency, which has tragically resulted in the loss of homes and lives. But the smoke produced can affect many more people not...

Brian Oliver, Research Leader in Respiratory cellular and molecular biology at the Woolcock Institute of Medical Research and Senior Lecturer, School of Medical & Molecular Biosciences, University of Technology Sydney - avatar Brian Oliver, Research Leader in Respiratory cellular and molecular biology at the Woolcock Institute of Medical Research and Senior Lecturer, School of Medical & Molecular Biosciences, University of Technology Sydney

Bushfires can make kids scared and anxious: here are 5 steps to help them cope

More than 600 schools have been closed, and some damaged, in recent days as bushfires rage across Queensland and New South Wales. Some students have been urgently evacuated while in school. People hav...

Toni Noble, Adjunct Professor, Institute for Positive Psychology & Education, Australian Catholic University - avatar Toni Noble, Adjunct Professor, Institute for Positive Psychology & Education, Australian Catholic University

'Like volcanoes on the ranges': how Australian bushfire writing has changed with the climate

Bushfire writing has long been a part of Australian literature. Tales of heroic rescues and bush Christmases describe a time when the fire season was confined only to summer months and Australia&rsqu...

Grace Moore, Senior lecturer in English, the University of Otago, New Zealand, University of Otago - avatar Grace Moore, Senior lecturer in English, the University of Otago, New Zealand, University of Otago

Farmers, murder and the media: getting to the bottom of the city-country divide

Left, farmer Ian Turnbull being who was convicted of murdering compliance officer Glen Turner. Right, Mr Turner's partner Alison McKenzie outside court. Tensions over land clearing can have tragic con...

Tanya M Howard, Senior research fellow, University of New England - avatar Tanya M Howard, Senior research fellow, University of New England

If Australian police officers are allowed to shoot to kill, they should be better trained

There is no clear evidence guns make police safer, but officers feel safer with firearms at their disposal. ShutterstockAustralians woke to the news last weekend that a 19-year-old Warlpiri man had be...

Rick Sarre, Professor of Law and Criminal Justice, University of South Australia - avatar Rick Sarre, Professor of Law and Criminal Justice, University of South Australia

Why municipal waste-to-energy incineration is not the answer to NZ's plastic waste crisis

Since the Chinese plastic recycling market closed, 58% of New Zealand’s plastic waste goes to countries in South-East Asia.from www.shutterstock.com, CC BY-NDNew Zealand is ranked the third-most...

Trisia Farrelly, Senior Lecturer, Massey University - avatar Trisia Farrelly, Senior Lecturer, Massey University

The robbery of the century: the cum-ex trading scandal and why it matters

Cum-ex trading, like a magic trick, involves shares 'disappearing' then 'reappearing' with a new owner to enable two parties to simultaneously claim ownership of the one stock. www.shutterstock.comIt ...

Alex Simpson, Senior Lecturer in Criminology, Macquarie University - avatar Alex Simpson, Senior Lecturer in Criminology, Macquarie University

A “loyalty tax” occurs when discounts are offered to new customers while longer-term customers pay more. Often this involves increasing premiums at the first and subsequent renewals.

As the NSW government’s Insurance Monitor, charged with making sure insurance companies do not charge unreasonably high prices or mislead policy holders, I have had my office research the prevalence of loyalty taxes.

Our research last year showed, on average, customers renewing their insurance policy paid 27% more than new customers. Our most recent data indicates the gap has risen to 34%. This translates to hundreds of dollars for the average home and contents insurance policy.

Loyalty taxes appear to be widespread in Australia. The Australian Competition and Consumer Commission concluded from different pricing inquiries that loyal customers of both banks and energy providers end up paying more. It also demonstrated the price difference for insurance in northern Australian – with one insurer on average charging renewing customers 15-20% more than new customers.

Read more: Consumers let down badly by electricity market: ACCC report

In Britain, regulators have calculated that customers are, by their fifth renewal, paying about 70% more than a new customer. The Competition and Markets Authority estimates the total cost of loyalty taxes in five British markets – mortgage, savings, home insurance, mobile phone contracts and broadband – to be about £4 billion (about A$7 billion) a year.

Translating this British estimate to the equivalent sectors in Australia (taking into account differences in population and GDP), the cost to consumers could be as high as A$3.6 billion, or at least $140 a year per person. This estimate does not include the energy sector, where evidence suggests the practice of charging longstanding customers more is rife.

Deceptive practice

Discounting to win new customers is not fair if the costs of that discount are passed on to longstanding customers. It discriminates against people who do not or cannot easily switch to another supplier. Vulnerable consumers – elderly consumers, those on low incomes, low education, or those with a disability – are disproportionately affected.

Complicated pricing structures often make it hard for consumers to compare quotes to see if one deal is better than another.

Read more: Inducing consumer paralysis: how retailers bury customers in an avalanche of choice

Consumer awareness of the loyalty tax appears to be low. It’s quite possible they may not be aware they are paying more each year. Companies can get away with making large price increases over successive renewals with little fear a customer will switch.

This practice is deceptive and falls short of community expectations. Greater respect for loyal customers is something the Hayne Royal Commission said financial institutions should have better regard for.

Read more: What are we teaching in business schools? The royal commission's challenge to amoral theory

An important reform

In NSW, in my role as Insurance Monitor, I introduced a requirement that insurers must display last year’s premium on the renewal notices to policyholders. The information is provided in a similar way as it is on a domestic water bill. It’s now a mandatory requirement in NSW, coming into effect this month.

But the good news is that all of the major insurers have decided to make the change nationally.

Ensuring customers can see just how much their bill has gone up since last year is a significant reform – one I have been pushing over the past five years, since I was involved in monitoring the pricing of insurance in the context of an insurance levy reform in Victoria.

Information empowers consumers. It puts pressure on insurers to justify any increases.

If you are not happy with the increase, or the explanation for it, you should shop around and reassess your options.

You will need to get a couple of quotes. Our research shows major variations in insurance quotes for identical homes with identical risks. Every quarter we seek quotes for a specified home with identical risk, and the highest quotes are up to 2.7 times that of the cheapest.

More can be done

The insurance market is in many respects like other sectors. While there are lots of brands to choose from, the market is highly concentrated and not particularly competitive. Like the banking industry, there are just four major players.

The larger problem, however, is on the demand side. Consumers are generally not well informed. The complexity of products and the large amount of fine print in contracts makes it hard for customers to tell if they are getting a fair deal. Once they’ve made a choice, most will not think about switching, because it’s time-consuming, costly and inconvenient.

I hope this reform will help increase awareness of what consumers are paying – and not just for insurance. I encourage governments and policymakers around Australia to support and continue with reforms aimed at better disclosure for consumers. NSW has taken a small step. But much more can be done.

Authors: The Conversation

Read more http://theconversation.com/simple-fixes-could-help-save-australian-consumers-from-up-to-3-6-billion-in-loyalty-taxes-119978