UK insurance: ‘My parents paid thousands to protect obsolete products’

How would you feel if you discovered your elderly parents had paid the equivalent of £5,000 over the past 20 years to insure a Sky set-top box that became obsolete in 2016?

Just ask Neil Allcock, who recently found out that his father had paid Domestic & General £300 this year to cover electrical products that are either no longer offered, or are worth next to nothing.

Having recently been given power of attorney over his father’s financial affairs he has been bemused at some of the direct debits leaving his parents’ bank account – not least the £25 a month they were paying to Sky Protect.

Their case is the latest example of why consumers need to keep an eye on insurance policies that renew automatically each year, asking family members whether they are still needed, or offer value for money.

In 2002 – possibly earlier, as the records do not go back any further – Allcock’s father, Bill, a football fan who lives in Hampshire, signed up to Sky Protect to cover his mini dish and set-top box. The idea of the policy, which is supplied and administered by Domestic & General, is that someone would come and fix the satellite equipment if it went wrong.

At some point it was extended to cover two aged TVs and an old worthless laptop.

“I think my parents thought they were insuring their Sky set-top box against it breaking down. That might have been the case back in 2002 when Sky customers owned the box, however, these were phased out in 2016 and replaced with Sky Q boxes that remain the property of Sky. As a result there was no point in insuring it, but that hasn’t stopped the company continuing to take its premiums,” he says.

He says his parents have been loyal Sky customers spending huge sums on their expensive TV package year after year. D&G which is separate to Sky, has declined to refund any of the premiums.

His father, who is the account holder, had a stroke and heart attack in 2012. As a result he became severely disabled in terms of sight and cognitive ability and had to learn how to read again. A more recent stroke necessitated the family invoking a financial power of attorney.

Allcock says on the one occasion they needed a significant repair – when their TV stopped working – D&G took it away and did not return it for nearly two months. Fed up with waiting, the family stepped in and bought another one, exposing the needless nature of such policies, which are a throwback to past years when equipment cost a lot to replace.

“It feels as if they have really taken my dad for a ride, and you have to wonder how many other older people are still paying for these policies. The company has claimed that there were nine claims but I think many of these must have been related to changes of the tech covered, not claims in the conventional sense Not to return the premiums since the Sky boxes became obsolete feels intrinsically wrong. As soon as I cancelled it we received a letter warning us that cover had ceased. What cover would that be,” he says.

A D&G spokesperson told Guardian Money: “The Allcocks have been longstanding customers and, over their 21 years with us, we believe they have demonstrated that they understood and valued their policy, by making nine claims against it and updating it to include additional items.

“We do our upmost to serve our customers, especially those who are vulnerable, and we take pride in facilitating 7,000 claims a day to help keep households running across the country.”

Sky says it wrote to Bill Allcock three times offering to upgrade his system but he did not respond. He has since been upgraded after his son’s intervention.

Meanwhile, Allcock says he has since discovered that his parents had recently been talked into a poor value BT home phone and broadband deal by a salesperson, and were significantly overpaying for their home insurance. BT has now shifted him on to a better EE deal and offered them £50 compensation.