diff --git a/tests/app/main/views/test_service_settings.py b/tests/app/main/views/test_service_settings.py
index a360f06f7..d71849835 100644
--- a/tests/app/main/views/test_service_settings.py
+++ b/tests/app/main/views/test_service_settings.py
@@ -1550,16 +1550,17 @@ def test_should_show_page_to_set_organisation_type(
         assert normalize_spaces(labels[index].text) == expected
 
 
-@pytest.mark.parametrize('organisation_type', [
-    'central',
-    'local',
-    'nhs',
-    pytest.mark.xfail('private sector'),
+@pytest.mark.parametrize('organisation_type, free_allowance', [
+    ('central', 250000),
+    ('local', 25000),
+    ('nhs', 25000),
+    (pytest.mark.xfail('private sector'), 1000)
 ])
 def test_should_set_organisation_type(
     logged_in_platform_admin_client,
     mock_update_service,
     organisation_type,
+    free_allowance,
     mock_create_or_update_free_sms_fragment_limit
 ):
     response = logged_in_platform_admin_client.post(
@@ -1579,6 +1580,7 @@ def test_should_set_organisation_type(
         SERVICE_ONE_ID,
         organisation_type=organisation_type,
     )
+    mock_create_or_update_free_sms_fragment_limit.assert_called_once_with(SERVICE_ONE_ID, free_allowance)
 
 
 def test_should_show_page_to_set_sms_allowance(