Older people at risk from overcharging and mis-selling ‘scandal’

theguardian.com:

Elderly and vulnerable customers are being routinely overcharged by utility and insurance firms in a hidden scandal highlighted today by one of the country’s senior financial services executives. Unfair practices are putting them at risk of being unable to afford food and heating, he warns.

Michael Donald, a former director of Visa UK, said he was staggered to discover hundreds of pounds of overcharging when he carefully checked the direct debits on his 79-year-old mother’s accounts.

“There is a great deal of mis-selling of services to the elderly, who are often unable to effectively check online statements and direct debits,” he said. “Organisations should be reviewing the accounts of consumers of pensionable age. In the current crisis, they have a duty of care to ensure the products sold are fit for purpose.”

Donald was asked by his mother, Carole Grant, who lives near Chichester, to check her financial affairs after the death of her long-term partner. He discovered that she had been sold two white goods insurance policies on a £330 Indesit washing machine that came with the standard warranty. The total cost of the two policies was more than £500.

An initial policy was purchased from leading household product insurance firm Domestic & General in May 2018 for £5.49 a month, and another three-year policy sold by Repair & Assure for the same appliance in September 2020 for £225.

The Information Commissioner’s Office (ICO) and the consumer group Which? have previously raised concerns about the sale of insurance for white goods to elderly people who may be vulnerable and buying unsuitable policies.

Sam Richardson, deputy editor of Which? Money, said: “Which? has warned about firms cold-calling and charging vulnerable customers