Half of consumers never check other providers to find better value deals – Charlie Weston
Householders are blowing the chance to save more than €2,000 a year on common household bills by failing to switch to better value providers.
The amount of money being wasted would cover the annual cost of the new water charges for the next eight years for a family.
Just a quarter of households admit moving to a different company to get a lower price for services they consume, research commissioned by a government agency shows. This is considered low when compared with other countries and means the majority of householders are losing out on the chance to make huge savings.
This situation is compounded by the fact that the best deals are often reserved for those prepared to switch.
Older people are the least likely to seek out better value.
And almost half of consumers have either never checked, or have not done so in the last year, to see if they could get better value car insurance by moving to another provider.
When it comes to electricity, some 43pc of people have never checked out the market for better value, according to research commissioned by the Competition and Consumer Protection Commission, the state body that resulted from the merger of the National Consumer Agency and the Competition Authority.
Its research shows that across 10 different services used by a typical family, savings of €180 a month can be made by switching to the keenest priced operator in the market. This works out at €2,160 a year.
However, our own research suggests that even more can be saved by making a few simple changes.
Experts said providers retained the best deals for switchers and rarely cut prices for existing customers. The research found that the vast majority of consumers who opted for a different provider saved money, and found the switching process easy.
Director at the new commission Fergal O'Leary said: "When consumers who had switched providers across a range of sectors in the last year were asked about the switching process, 76pc described the process of switching provider as 'easy'."
He said consumers rated gas and electricity as the easiest to switch.
Mr O'Leary said that often new customers were offered better rates than those available to existing customers. This meant loyalty was not always rewarded. "If it isn't, we would strongly urge consumers to switch but the first step in this process has to be checking to see if a better deal is available," Mr O'Leary said.
The low numbers switching meant it was highly likely that consumers were overpaying for services.
One of the biggest savings is from moving mobile phone operator, with typical monthly savings of €24.
Savings of more than €34 a month can be made by swapping one health insurer for another, with savings of €21 a month typical for moving around among the four main electricity suppliers.
Other areas where switching can help when money is tight include car insurance, broadband, home insurance, gas supplies, fixed-line telephone services, waste provision and TV services.
Just seeking out the best value on three services - mobile phones, electricity and car insurance - can save a typical family €60 a month. Over a year this works out at more than €700.
Overall, around four out of 10 have switched at least one provider, with most moving to get better value car insurance, according to the research of 1,000 adults conducted by Behaviour and Attitudes for the Competition and Consumer Protection Commission.
How you can save 2k
By Charlie Weston and Paul Melia
WHERE YOU CAN SAVE
Car insurance – possible saving €180 a year
There are at least eight motor insurers active in the market, with credit unions involved in reselling motor cover at good rates for members.
Shopping around for car cover will save you lots of money. Search for quotes online, then pick up the phone and haggle. Your existing insurer will be likely to match any offers you get from rivals, saving you having to move to another company.
If your other family members are not already on your policy, ask if it would be cheaper to get them added.
Consider carefully before taking the monthly payment option as insurance companies add on a service charge for this facility. If you are able to pay in one go, this is normally the cheaper option. Your premium could cost up to 22pc more if you pay in instalments.
Current account – possible saving €120 a year
The main banks all have some sort of charges on current accounts.
Bank of Ireland charges €5 a quarter, whether you keep lots of money in the account or not. Ulster Bank charges €4 per month maintenance fee.
But you can avoid these fees if you keep an account balance of at least €3,000 in the case of Ulster Bank, and keep in credit to the tune of €2,500 at AIB.
If you are even smarter, you will switch to Permanent TSB. It has no charges or fees if you lodge €1,500 into the account every month, and you do not have to keep that amount in the account.
The Central Bank’s Code of Conduct on the switching of current accounts is designed to make switching quick and easy.
Home insurance – savings of €156 a year possible
Seeking out better value home cover will save the average household €156 a year, according to the Competition and Consumer Protection Commission.
Many people have been with their home insurer for a number of years and don’t switch, either due to loyalty or apathy. But there are a number of insurers who have only entered the home insurance market in recent years. They have not been hit by flood claims.
Cover can differ from company to company, and even policy to policy, but there are always savings to be made.
Make sure that you have a realistic value for the rebuilding costs of your house. Many people value their house based on the sale value – this includes the site that your house sits on.
Health insurance – possible savings €1,400
A family of two adults and two children could easily save this much by getting a better deal.
The sad reality is that thousands of people are paying too much for their health insurance and could get better-value policies.
Contact your existing insurer but ask the right questions. Don’t just ask for their recommendation. Ask the staff to search all their plans for the closest equivalent plan to what you currently hold.
Insist that they check their full suite of plans including corporate, nurse and teacher options to find the closest equivalent to your existing cover.
When they come back with a recommendation, get them to confirm again that this is the best option across all their plans – remember, all these calls are recorded.
And be prepared to switch to another provider if you do not get better value.
Television – possible saving €348-plus a year
UPC prices are set to rise next month as the company rolls out price hikes of up to 14pc on its television, broadband and phone packages, while Sky is also raising its basic TV package by €1 a month.
Bill free TV which allows you view Irish stations free of charge on Saorview and British stations free on Freeview remains the only way of avoiding these hikes – and ongoing monthly charges.
For a one-off installation charge of €289 with providers such as billfreetv.ie and freetoair.ie you get the equipment to say goodbye to monthly TV bills for ever, but while all the major Irish and British stations are available and dozens of smaller ones, you can’t get Sky Sports on it.
With UPC the cheapest TV package available including 50 channels has gone up €1 to €30 a month or €360 a year, though new subscribers can avail of a reduced €10 per month charge for the first four months.
On Sky, meanwhile, the cheapest package has gone up to €29 per month or €348 a year.
For TV packages including Sky Sports, the cheapest UPC package is €67 per month reduced to €47 a month for the first four months, while with Sky you will pay €65 per month. More information is available on Bonkers.ie.
Energy – possible savings of €300 a year
Reducing energy costs is among the easiest ways to cut your household bills, and shopping around is key.
Customers can both contact companies directly, or use a number of price comparison sites including Bonkers.ie which is accredited by the Commission for Energy Regulation.
For gas, someone currently on the standard Bord Gais package is paying €993 a year. Switching to Flogas will reduce that to around €835, a saving of €157.90 or 16pc.
A customer currently taking electricity from Electric Ireland pays €1,210 a year. By switching to SSE Airtricity, that can drop to €1,064 – a saving of €146 per year, or 12pc.
In all, that’s a total of €303.
There are also savings if you take both gas and electricity from one supplier, but the deals tend to be better if using separate companies.
Bin charges – savings of up to €170 possible
Choosing the best operator can be difficult, as the best value deal depends on household size and what kind of waste you produce.
The Environmental Protection Agency says the average household disposes of 304kg of waste a year. As a rule of thumb, the more you recycle and compost, the less you pay.
By way of comparison, charges in Dublin range from €203 a year with some companies, although you don’t get a brown bin, rising to a high of €374.
Some offer flat fees, meaning there is no upper limit on the amount of waste which can be disposed of, while others have a complicated tariff structure which often includes an annual service charge, a fee each time the bin is lifted and a fee per kilogramme of waste disposed of.
Companies also charge different rates per county.
The sad reality is that thousands of people are paying too much for their health insurance and could get better-value policies. Contact your existing insurer and ask the staff to search all their plans for the closest equivalent plan.
'Reliability of broadband service the most important thing to us'
IT worker Stuart Butler (37) from Castleknock in Dublin said the biggest reason he chose to switch broadband provider was reliability of service.
Mr Butler, who lives with his fiancee Laura, said: "When I lived in a previous house in Blackrock, the only service available to us was Eircom, and we found it to be quite slow and quite expensive for the download speeds we were getting.
"When we moved house, we changed over to UPC, and they had an integrated service where we could get the broadband, the TV and the phone all in one package and in one integrated unit. We shopped around at the start, but we just wanted to get everything from the one provider, so we just went with UPC because they were competitive with the price at the time."
The couple pay €72.98 per month for UPC's Horizon Essentials Bundle.
"I checked and the download speed we're getting is what we're supposed to be getting. I find the service very reliable. There has been almost zero downtime for all the services. I can't recall when we weren't able to watch the TV or go online," said Mr Butler.
"Reliability of service is the most important thing for us, and the speed is always enough for us."