What price loyalty?
Sticking with utilities and service providers won’t save you cash... but it’ll likely cost you I t’s time to make some little changes that could help save you lots of money. Unless you stand up for yourself and make a fuss about it, household utilities and service companies will continue to take you for a ride with high charges for products they offer others for lots less.
Whatever your – possibly now forgotten – new year resolutions, plan now to prevent further rip-offs. You could be hundreds of pounds better off for half an hour’s work. Can you ignore that sort of return?
Over the past year, organisations like Which? and Citizens Advice have issued warning after warning telling households that insurers, gas and electricity providers, and phone companies keep the best deals for those who switch or protest. They give the worst rates to those who simply renew year after year.
It’s called the “loyalty penalty” – whether it’s down to “can’t be bothered” or “what’s the point” or “I don’t know what to do” – firms make fortunes from customers doing nothing.
Watchdog the Competitions and Markets Authority is looking into “loyalty” pricing. In December, it said this cost households a massive £4bn a year – about £150 for every single home in the UK.
But the probe’s results will take some time to be put into practice. In the meantime, you will have to act for yourself if you want to defend your bank balance.
Get organised. Make a list of all household deals – insurances, broadband and landline, gas and electricity, mobile phone, and mortgage, if you have one.
Then show that Christmas present calendar with cute kittens or daft dogs is some use by marking “escape” dates for each of the above.
These should be a month before the deal ends – don’t rely on providers to remind you.
Then get onto comparison companies to find something better. It’s easiest to do this on the web, but most switching companies have helplines – so if you are not online, ask a friend or family member to find these details for you. The worst that can happen is you end up no better off – but that’s very unlikely.
With Alex Neill of Which? It’s called the ‘loyalty penalty’. Whether it’s down to ‘can’t be bothered’... or ‘I don’t know what to do’... firms make fortunes from customers doing nothing.