Can I avoid early exit fees when switching provider?

twitter@billtyson8 Q Consumers are always being urged to shop around and switch to a better-value deal for things like broadband, mobile phones and energy supply. Yet when I saw a better deal for my mobile phone I was shocked to discover I’m locked into an 18-month contract. Do these early exit charges apply to other things as well? And how can they justify them? A I’m afraid most companies have early exit charges. When you sign up for a service, you sign a contract and breaking it can incur a penalty. It works both ways. Providers are also subject to contracts and you’d be pretty miffed if they broke their side of the bargain without any penalty.

At least you’re not alone. Almost threequarters (74%) of consumers are in the dark about early exit penalties on their contracts for household essentials, a recent survey by switcher.ie showed.

A third don’t know if they would incur a penalty, while 41% are unsure of the amount.

The trick is to know the true cost of signing a contract when you do – and not later on as you found out now to your cost. And then make sure to take it into account when weighing up the value of a service.

Mobile phone companies generally insist on being paid for the full outstanding balance of your contract, which is a potentially huge cost.

Phone contracts are also getting longer – up to 24 months in some cases.

There’ll be a nice carrot such as a new smartphone but it could cost you dearly if you can’t get out of a contract for up to two years.

And if you lose or break your phone you may not be able to avail of the cheap deals for a new one that are normally offered only to people signing up for the first time, or renewing a contract. All this makes a contract-free mobile phone deal such as that offered by iD all the more attractive.

After mobile phones, broadband providers have the highest exit penalties, according to switcher.ie.

One provider, Magnet, doesn’t have a contract so there’s no exit penalty, which is a major plus as you can switch if something better comes along.

It’s easy to remember energy company exit fees – they all charge €50, or €100 for dual fuel deals for both gas and electricity. Q I was one of the 15,000 Irish victims when Lowcostholidays went bust last month and scuppered our originally planned break in Spain. As I had already arranged for leave from work, I had to book an alternative holiday. Having just returned from it, am I too late to make a claim now? A If you booked flights and rooms together, you still have until September 19 to claim a refund from the Commission for Aviation Regulation (CAR). Fill out the form provided on aviationreg.ie by that date. Email claims@aviationreg.ie or call (01) 888 9000.

If you booked flights only, you may qualify for a refund if travel commenced or was due to do so within the Irish Republic.

Customers who booked accommodation only can’t claim from the CAR, as the licence and bond it issued for Lowcostholidays doesn’t cover this.

But they may be still able to reclaim from a credit card provider for services paid for but not received, as long as they booked accommodation with their card.