Face up to your fear and cash in by switching supplier - loyalty is a mug's game
Are you being fleeced because of fear? It seems that fear is one explanation for the fact that so few of us switch providers for household essentials like insurance, television and energy services.
We fear getting tied into a long-term contract and we are unable to tell if we will save money by switching. We fear switching will be too much hassle. We fear loss of service if we switch, and we fear that any new product would not be the same as the one offered by our current supplier.
Research from Switcher.ie found households are feeling the pinch but they fear a loss of service if they move to a new supplier to save money. This is despite the fact that staying with the same provider can mean missing out on deals that can save a household around €300 a year.
The research suggests that fear factors are continuing to prevent people from taking control and securing a better deal.
Surveyors for Switcher.ie asked a nationally-representative sample of 1,000 people about switching electricity, gas, home insurance, motor insurance, health insurance, current accounts, home phone, mobile phone, broadband, television, and bin services.
A majority of people expressed an intention to switch at least one household service, but other research shows many fail to follow through on this. Loyalty is a mug's game.
The research found that a quarter of consumers stick with the same provider for five years or more. Loyalty makes it easy for companies to make money out of us as there is no incentive to cut prices for existing customers.
And it is not as if the new product would be any different to your current one.
Take energy. All electricity and gas suppliers use the same network to supply household energy. Recent figures from the Commission for Energy Regulation show that just 14pc of households switched energy supplier last year. This means most of us are missing out on the best deals, which are reserved for switchers. There is evidence of awareness of switching and it is the case that households' intentions to switch are high, but people are still being held back by fear factors.
Some companies offer what are called retention deals to existing customers, but you will still do better if you switch.
Signing a contract with a new provider can seem daunting, but it doesn't need to be. In general, they range from just 12 to 24 months for the likes of energy, broadband and TV. Some SIM-only mobile deals, and some broadband and TV plans, are available on 30-day contracts.
The bottom line here is that we need be brave.
Sunday Indo Business