Since October 2016, when the Advertising Standards Authority declared that all broadband providers need to clearly show all upfront costs, including line rental, in their price claims, it has been easier to understand the contracts that you are committing to. However, there are still ways that broadband providers can increase their prices, so it is important to be aware of the different ways with which this happens and how you can avoid them.
Broadband Price Increases During Your Contract
It is not uncommon for Internet Service Providers to hike the cost of your broadband package midway through a contract that you have signed up for. This is natural, as the power and speeds of broadband increase with improvements in technology, as do the costs for providers, which means that customers end up paying more.
So, although usually you will be getting more, such as faster connection or a higher download limit, you will have to pay more for this. However, thanks to a ruling by the regulator Ofcom, you are able to cancel your contract without any penalties, if prices are raised before the end of it and you choose to cancel within 30 days of being notified. This is as long as the price rise was not mentioned in the terms and conditions when you first signed up.
If you are unhappy with the increase of price, it is worth contacting your provider before choosing to cancel your contract. In most cases, you will be referred to the company’s retentions or disconnections department, who may try and offer you cheap broadband to try and keep you as a customer. Make sure that you do your research first before you do this, so that you know what introductory deals are available so that you choose the best broadband deal for you and your household.
Known Price Increases
A number of broadband deals come with price increases included in the terms of the contract, such as when an introductory offer finishes. If this is the case, then you may have to pay a penalty if you wish to leave the contract early, so it is important to be aware of any listed price changes when you first sign up.
These penalties can be quite large. For example, if you choose to leave three months into an eighteen month contract without any unexpected price increases, you may still have to pay for fifteen months worth of broadband.
Broadband providers may also raise prices for consumers when their contracts expire. According to Ofcom research, people with landline and broadband bundle packages pay around 20% more when they are out of contract. New rules mean that providers must now warn customers between 10 and 40 days before their contract is up, as well as informing them about any broadband deals that they may be eligible for. However, you should make a note yourself about when your contract is due to expire, so you avoid getting caught out by any sudden price increases.
Price Increases by Retail Price Index (RPI)
Under Ofcom rules, providers are allowed to increase their prices along with the rate of inflation during the course of your contract. This is measured by the Retail Price Index (RPI), which is released by the government. Although these types price hike do not entitle you to leave your contract without any penalties, these increases are usually only by a few pennies.
You might find that you are getting charged more than what you think you should be paying on your broadband deal. This could happen if you are going above your data allowances each month, so if you are regularly downloading large files, or watching a lot of movies, it could be worth switching to a broadband deal that includes unlimited downloads. Fortunately, most of the available packages these days include unlimited data, so consider switching providers to get the best broadband deal for you.
So, hopefully with these tips you will be able to avoid paying more for your broadband than you need to. Most importantly, keep checking your bills to make sure that your contract has not expired, and that you are not exceeding your allowances. Also remember to compare broadband deals from different providers if your prices have gone up unexpectedly, so that you can switch if you need to cancel your contract.