Phone and TV companies will soon be required to tell customers when they have come to the end of their contract in a bid by the communications regulator to stop overcharging.
Ofcom said more than 20 million broadband, pay-TV, mobile phone and landline customers have stuck to their contracted subscriptions for longer than necessary, often accidentally.
This can lead to people paying hundreds of pounds more than they have to, due to being on tariffs which far outweigh their actual usage.
According to the regulator, customers who bundle their landline and broadband together pay around 20 per cent more on average when they are out of contract, with that rising to 26 per cent when pay-TV bundles are included.
What are the new rules?
Ofcom has said that the likes of Sky, BT and TalkTalk will have to inform their customers when their contracts are about to end and be told about the best alternative deals.
Even those who do not opt out of their contracts will have to be reminded they can still move tariffs on a yearly basis.
Service providers - including mobile networks such as O2, Vodafone, and EE - will have to text, email or send a letter to customers between 10 and 40 days before their contracts come to an end.
They must state the date after which the contract can be cancelled without a penalty, the price a customer has been paying, and any changes to the price or service that automatically happen after the date.
They must also state the notice period for cancellation and the best alternative subscriptions on offer including the prices available to new customers.
How long will it take to happen?
Companies will have until 15 February 2020 to update their systems to ensure notifications are sent out.
It will mean that the one in seven customers who don’t know whether they are still on their original contract and one in eight who don’t know when their contract ends will be told if they can save money next year.
Lindsey Fussell, Ofcom’s Consumer Group Director, said, “We’re making sure customers are treated fairly, by making companies give them the information they need, when they need it.
“This will put power in the hands of millions of people who’re paying more than necessary when they’re no longer tied to a contract.”
This article originally appeared on our sister site, Edinburgh Evening News