4 million pensioners are f leeced for not using net
NEARLY four million pensioners are routinely ripped off because they do not use the internet.
Analysis by Money Mail has found that older customers are being locked out of the best energy, savings, phone and insurance deals.
Official figures show that four in five of those who do not have access to the internet are over the age of 65 – equal to 3.8million of a total of 4.8million in that group.
They face a raft of penalties designed to push customers to internet deals for essential services because these are cheaper for big companies to run.
It comes after the Daily Mail revealed yesterday that energy firm EDF is now charging customers £90 a year to pay by cheque, a 15 per cent increase on previous rates.
Last night campaigners and charities said firms should stop discriminating against older customers who cannot or do not want to use computers.
Former pensions minister Baroness Altmann said: ‘Companies are profiting from loyal elderly customers who renew or buy in person or over the phone. These trusting older people are hit with unfair penalties or harsh price hikes for not going online.’
Money Mail’s analysis found that in the worst cases older customers have been overcharged by up to £1,673 on their home and car insurance policies over the past ten years because they have been unable to use the internet to shop around. It found that pensioners are being overcharged by a total of £880million each year on their car and home insurance. Experts say one of the main reasons older customers are failing to switch is that most of the best deals are advertised on price comparison websites such as Go Compare or Compare The Market.
A number of major telecoms providers do not offer customers phone lines without demanding that they buy a broadband package. Among those that do offer line-only deals, BT charges £11.99 a month after it was forced to cut its price by the regulator, Ofcom, from £18.99 this month. The Post Office charges £16.99 a month – only £2 less than its deal that includes broadband, which currently costs £19 a month. Last night, the Post Office said it would cut its landlineonly fees to £11.50 next month.
Many firms also charge a fee to those who receive bills through the post rather than online. Vodafone says 75,000 of its customers still receive paper bills. It charges £1.54 a month for the service. Vodafone said this reflects the costs of processing payments.
Sky and Virgin charge some of their customers £1.75 for each paper bill. BT charges customers £2.50 a month if they have broadband, but says the fee is waived for landline-only customers.
British Gas has barred customers who do not use the internet from getting its best energy tariff. One offer, which includes eight hours of free energy each Saturday, is said to save users around £60 a year – but customers are being turned down if they do not manage their accounts online.
EDF’s £90 annual fee for paying gas and electricity bills by cheque is not the worst among the big suppliers. Npower customers have to fork out an extra £94 a year to pay their bills this way. Eon charges £90, while the fee is £86 at British Gas, £80 at SSE and £79 at Scottish Power.
The best rates on savings accounts are reserved for online customers. As a result, many over-65s who cannot or do not want to use a computer are missing out on up to 1.25 per cent interest with high street banks such as Lloyds, HSBC, Halifax, Santander, NatWest and Barclays.
This works out at £125 a year on each £10,000. On the average savings pot of £45,000, the total in lost interest is £562.50 a year.
The Association of British Insurers said: ‘Our Vulnerable Customers at Renewal Code is helping insurers and brokers to identify customers, including older policyholders, who may need extra help in assessing their options.
‘The cost and availability of insurance does need to reflect the fact that for some insurances, like motor and travel, the average claim cost increases with age.’
‘Hit with unfair penalties’