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Tony Levene is a renowned financial journalist, who has previously been a columnist for Guardian Money. He has written several books, including 'Investing for Dummies' and won the ABI LIfetime achievement award and the Headline Money award.


How to switch service providers

A month or so ago, I received an electric (and gas) shock. My dual-fuel supplier informed me my low cost internet deal was terminated and it was “standard” tariff for me. “Standard” is utility company speak for expensive – my bills would go up seven per cent overnight.

I'd been with this company for years but it seemed no longer to value my loyalty. So armed with recent bills recording usage, I hit online comparison sites to find a better deal.

Quotation MarksYou probably fit into one of three categories – permanent switcher, provoked switcher, or apathetic.Quotation Marks

I switched. There were a few forms to complete and letters to read. But the comparison site and my new supplier did all the hard work – it was not nearly as difficult as I feared. And I'll be saving enough for a celebratory meal out.

But it's not just electricity and gas. Most of us have other long term indefinite contracts which may often start with a market-leading deal but end up poor value. These include broadband, pay TV packages, home fixed-line phones, mobile phones, insurance and current bank accounts.

Types of switcher

Now ask yourself what sort of person you are when it comes to selecting a utility, phone or bank. You probably fit into one of three categories – permanent switcher, provoked switcher, or apathetic.

The first group spends time researching deals and may move as often as the contract allows – this can be as little as 30 days on some mobile phone and fuel deals. The second category tends to check when they are told of a big price increase or receive poor service.

The third group, where apathy rules supreme, is still immense. Do they stick out loyalty – fine if it's a beneficial two way process – or because they think switching is complex and something is bound to go wrong?

So why switch?

Cost is one significant reason but “cheapest” and “best” are rarely synonymous. It's often because something you signed up for several years ago no longer meets your needs. Your broadband might be too slow, your mobile phone might not be “smart” or your bank's online offering might creak.

Nothing can be absolutely guaranteed and switching bank accounts or mobile phone companies is not instantaneous, but if you're a first time switcher, it's probably easier than you think.

Take current accounts. Open an account and the new bank will contact your old bank – you don't have to explain why you want to move. The new bank will arrange to transfer direct debits, organised the switch of payments such as salaries and pensions and close your old account if you wish. Some banks offer interest free overdrafts or service guarantees just in case there are delays. The process takes about four weeks to complete.

Finding a better mobile phone deal is easy – but make sure first that your existing contract does not tie you in long term. If you’re happy to change your number, you just start using your new SIM card at once. Otherwise – and most want to keep numbers – ask your old supplier for a PAC (Porting Authorisation Code) number before you move. You give this to the new provider who will tell you when the transfer is complete. Phone regulator Ofcom reduced the time this takes earlier this year. See:

Don't forget some areas are blind spots for some mobile firms. If you want to use it at home or work, check out “mobile phone coverage” maps on a number of commercial websites.

According to website, 70% of people have been with the same home insurer for more than a year. The reasons for this vary, with many people thinking it’s too complicated to change. In fact, switching insurance providers can be surprisingly easy, with many offering incentives to draw you in. Although the aim is to save money, it’s important to make sure you have the right level of cover and this may not always be the cheapest.

Switching broadband involves a similar process but based on a MAC (Migration Authorisation Code). Points to watch include length of contract, whether you are still tied in, whether you use an email address based on your current broadband supplier and how a change will affect other services that may be bundled in such as a landline or television. Ofcom says transfers should be seamless.

Finally, a few weeks after I switched fuel firms, the former provider phoned, offering £150 credit in a year's time and a better deal than the one I'd rejected if I changed my mind. I'm thinking about it.

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