Age UK faces further criticism on insurance deals

The charity Age UK is facing further criticism - this time for selling insurance deals that may not be the best value for money.

On Thursday, the Sun newspaper claimed the charity was earning £6m a year from recommending energy deals that were not the cheapest available.

Now the paper says Age UK earned £21.9m last year from selling insurance.

The charity said it "strongly" rejected the latest allegations, and interpretation of figures.

Deals on car insurance being promoted by Age UK did not appear to offer the best value for money, the Sun claimed.

An Age UK policy for a woman of 70 driving a 2005 Nissan Micra would cost £544, according to its website.

But Ageas, which supplies the policy, offers a cheaper deal under its Kwikfit brand, for just £371.

However, some of Age UK's other insurance deals were cheaper than rival quotes.

Conditions also vary from one policy to another.

Age UK said its prices were always competitive, but it had never claimed to be the cheapest at all times.

"We offer good value products that can be relied on by older people in a volatile market place," a spokesperson said.

"For example, our insurance products have no cancellation or change fees, no upper age limits, interest free instalments, are Which? recommended and achieve Defaqto five star ratings. Any net profits go straight to charitable activity supporting vital work for vulnerable older people."

The energy regulator Ofgem and the Charity Commission said on Thursday that they would investigate Age UK's behaviour.

But speaking to the BBC, the Charity Commission said its powers were limited to examining the role of trustees.

Michelle Russell, director of investigations at the Charity Commission, said fund-raising was "self-regulating".

"Our role is about holding trustees to account, and ensuring they comply with the law - and that's exactly what we're doing," she told Radio 4's Today Programme.

But one commentator said she was surprised that the Commission's powers were so limited.

"The public has always assumed that someone - the Charity Commission - is overseeing these charities," said Harriet Sergeant, an analyst with the think tank the Centre for Policy Studies.

"We've suddenly realised they don't seem to be overseen at all."

The Charity Commission is due to get more powers to investigate trustees under the new Charities (Protection and Social Investment) Bill, expected to get Royal Assent by the end of February.

However, it will not extend its powers to examine fund-raising.

The Fund Raising Standards Board (FRSB) has already said it will investigate whether Age UK broke the Fundraising Code of Practice.