Credit, Collections & Insolvency News
UK households stick with the same energy supplier for an average of four years, according to new research from comparethemarket.com. This equates to many households, on average, overpaying on their energy bills by £1,232**.
For some families, the overpayment could be even greater. comparethemarket.com found that nearly a third (30%) have been with their provider for five years or more and over one in ten (14%) have surprisingly stuck with the same company for eleven years or over.
| Money lost
by not switching |
Number of households which haven’t switched in 1-11 years nationwide*** | |
| 1 year | £308 | 6.7 million |
| 2 years | £616 | 4.4 million |
| 3 years | £924 | 3.4 million |
| 4 years | £,1232 | 2.3 million |
| 5 years | £1,540 | 1.9 million |
| 6 years | £1,848 |
2.4 million
|
| 7 years | £2,156 | |
| 8 years | £2,464 | |
| 9 years | £2,772 | |
| 10 years | £3,080 | |
| 11 years | £3,388 | 3.8 million |
Not only are households paying more than they need to, but many agree they have a less than perfect relationship with their energy supplier. Nearly a fifth (18%) felt that they have a poor understanding of how their energy company should behave, that their provider is rarely in touch with them, and that they feel they are taken advantage of. Some (8%) also admitted to looking for a new supplier which better understands their needs.
When asked the reason behind their decision to switch energy suppliers, over one in ten cited a lack of communication and the fact that their bills were too difficult to understand. A similar number felt that poor customer service was a key reason they decided to switch supplier.
Peter Earl, Head of Energy at comparethemarket.com, said: “You wouldn’t put up with a partner who didn’t understand your needs or ignored you, so why stick with an energy supplier which does just that? Households that are staying with the same provider for years on end, are likely to have been rolled over onto uncompetitive Standard Variable Tariffs which are often much more expensive than a fixed rate tariff.
“These findings clearly demonstrate how important it is to shop around for your energy provider. Few households can afford a £300 additional annual expense, but our research shows that it is not only price which convinces people to shop around. Factors like poor communication and complexity of bills also play a big part. In order to remain competitive, energy suppliers need to show customers they care, not only when it comes to price but also with improved levels of customer service too.”
