Fold7 has worked with Gocompare.com for the past two years. It will cease working with the brand immediately.
The news follows the completion of Esure’s purchase of the 50 per cent of Gocompare.com that it did not already own for £95 million on 1 April.
Ryan Newey, Fold 7’s founder, said that the split was due to creative differences.
He said: "We did what we knew was right for the brand and it delivered great results. We’re generally a pragmatic bunch but in this instance we’re sticking to our creative convictions. We’ve parted company on a high and wish the business every success."
It is understood that the Gocompare.com is keen to revive its infamous, opera-singing mascot, Gio Compario, in its ads.
Gio Compario was played by the Welsh opera singer Wynne Evans. He first appeared for an ad for the brand in 2009 and the character was created by Chris Wilkins and Sian Vickers, who also created ads for Direct Line, Sheila’s Wheels and Esure.
Later ads for Gocompare.com, created by Dare, acknowledged Compario’s irritating qualities and showed celebrities and bystanders attempt to kill the tenor to stop him singing.
When Fold7 took over the account in 2013, the agency created ads that did not feature Compario at all, and instead focused on a team of insurance experts from the fictional Welsh town of llandofsavingmoneyandgettingtherightdealgogogocompare.
A spokesman for Gocompare.com said: "We can confirm we have parted company with Fold7. We are not commenting on our future plans or arrangements at this stage."