When a new phone and cable company established their business in Ramona’s home town and advertised lower monthly prices, she decided to make the switch and forgot to read the Terms of Service Agreement before signing. As it happens, 65-year old Ramona made a three-year commitment with the new company, but the lower monthly prices were just a “teaser” or introductory rate she would receive for the first three months.

Elder Protective Services reviews teaser rates further in our article Notorious Utility and Energy Scams. Upon the fourth month, Ramona realized she was paying more per month than when she was with the original phone and cable company. But snuggled in the fine print, Ramona found another provision that read “Customers must pay the service provider a $500 cancellation fee” upon termination of the service. When speaking with customer support, Ramona was given the run-around.

Sadly many service companies take advantage of elders through the fine print of their Terms of Service Agreement or contract. Elder Protective Services always advises to read the fine print and not fall prey to “sense of urgency” sales tactics. Before making an investment or signing a contract, familiarize yourself with the red flag terms and phrases below.

Terms to Look for Before You Buy or Sign

Many seniors spend considerable time researching products before purchasing in order to get the best deal. It’s important to note that a great short-term deal might end poorly in the long-run. A product with a great price during a Black Friday sale could become faulty right after the 90-day factory warranty. A service provider with inexpensive introductory rates may become impossible to terminate due to heavy cancellation fees. Before investing in a new product or service, potential customers should research thoroughly and proceed with caution if the Terms of Service Agreement includes any of the following terms or phrases:

Red Flag Terminology

Automatic Renewal

  • A contract that reads “automatically renews” could result in customers continuing to pay for a product or service that they no longer need. Automatic renewals can be helpful for a product or service a customer needs or uses daily, but customers should be wary if the phrase is hidden in the fine print or non-negotiable.


  • The phrase “nothing is free” has never held truer than it does with Terms of Service Agreements. Customers should keep in mind that if they are not paying outright for a product, the company is likely selling their information for monetary gains. As Elder Protective Services reviews in our articles on phishing, once a company or hacker has hold of personal information, like phone numbers or addresses, that information will be sold to solicitors or other cybercriminals. If the word “free” is mentioned in a contract, it’s a good practice to assume that you will be paying for something later.

Free Trial

  • Many services, like internet or streaming, often entice potential customers with a free trial for a certain amount of time before a credit card or bank account will be charged. If users register for just a free trial, they might end up paying more than expected once they forget to cancel the service. Oftentimes, the fee after a free trial is more expensive than a regular membership. Use caution when signing up for a free trial.

For # Months

  • Like in Ramona’s experience above, many companies will offer an introductory price or teaser rate for a surprisingly low amount to attract new customers. After the first few months, the monthly price will increase immensely. $25 a month for cable may sound great in August, but if the price jumps to $125 in November, is it actually a great deal? More often than not, customers who try to cancel their service wind up with hefty termination fees. Always read the fine print to avoid being swindled.

Furtive Fees

  • Within some Terms of Service Agreements or contracts, companies will slide in various fees: late, cancellation, and service. If a late fee seems like a substantial amount, it’s best not to risk potentially being late and fined – find a different provider or product. A ridiculously priced cancellation fee is suspicious, use caution. If service fees seem unreasonable or do not clearly state what the sum is for, the product or provider is likely not worth the cost. Elder Protective Services encourages seniors NOT to buy a product or sign a contract if there is any sense of fear.

High Prices but Low Privacy

When thinking about privacy, understanding the difference between a Privacy Policy and Terms and Conditions is key. Privacy Policies always protect the users’ information and rights, whereas Terms and Conditions protect the company’s or website’s rights. Elder Protective Services advises seniors to use caution if a Terms of Service Agreement or contract seems to have simple or lax Privacy Policy. Other Terms of Service Agreements encourage customers to unknowingly give away personal or private information. Before signing any contract, potential customers should research the following terms and phrases:

Red Flag Terminology

Third Party

  • This phrase implies that customer personal information and the data collected about the customer through the service or product is being sold to outside companies for marketing purposes and monetary gain. Ultimately customers will receive unsolicited mail, phone calls, emails, or other sales materials from third party companies. Some research suggests that free offers are funded by third party companies as a marketing and sales tactic.

Opt Out

  • This phrase typically signifies that companies can use customer information or data however they see fit UNLESS the customer takes the steps to “opt out” or stop it. Generally the “opt in” setting is pre-selected in online Terms of Service Agreements. If you do not want your information sold or used as research, make sure to select “opt out” or deselect “opt in”.

Learning More About Your Interests

  • This phrase suggests that the service provider or product is “augmenting what you are telling it with outside data in order to know more about you” (AARP). This means the service or product can target a customer’s potential “likes” with specific advertising for them, which will ultimately result in them spending more money.

Elusive Legal Loopholes

Lawyers and contract specialists work tirelessly to phrase Terms of Service Agreements in such a way that the service provider or company will not be held liable or can evade potential lawsuits. Understanding these legal loopholes are important before investing in a new product or signing a contract.

Red Flag Terminology

Class Action Waiver

  • When a group of people have been ripped off or harmed by a company or product, they can team up in what is called a Class Action Lawsuit. Class Action Lawsuits are not only damaging to a company’s finances, they also harm the company’s image. The phrase “Class Action Waiver” prevents this by forcing consumers to waive their right to this type of lawsuit. A customer could potentially sue the company individually, but such an enterprise could be financially ruinous for any under protected senior.

Liquidated Damages

  • If this phrase is hidden in the fine print, be wary before signing the contract. By using this phrase, a service provider or company will try to cap the potential damages a customer could receive if a courtroom battle ensues. This means the consumer might spend more in attorney fees than they will receive in damages.

Mandatory Arbitration

  • This phrase means that a consumer cannot sue in a court of law if they feel the service misled them or even if they were harmed by a product. Such a phrase forces all concerns and disputes to go through an arbitrator for settlement.

Limitations for Suit

  • In short, a suit limitation clause limits the time in which a consumer can bring a lawsuit against their service provider if they are seeking coverage for a loss. This phrase implies that the customer may have a faulty product or could potentially be harmed by the service after a specific period of time. If a contract has the phrase “suit limitation” hidden in the fine print, it might be better to find a different product, company, or service provider.

Hold Harmless and Indemnify Us

  • This phrase gives companies or corporations the ability to force a customer or worker to pay the company’s legal fees in the case of a lawsuit. Between their own attorney fees and damages suffered, a consumer may spend more money than they will make in a lawsuit after paying the corporations’ legal fees.

Key Takeaways:

Terms of Service Agreements can take serious advantage of seniors. To prevent falling victim to the fine print remember to:

  • ALWAYS read the Terms of Service Agreement and fine print, even if it may make a decision take longer.
  • AVOID signing agreements or contracts that offer “free” services or products.
  • USE CAUTION when a deal seems “too good to be true”.
  • PROTECT your privacy by opting out or avoiding contracts that force customers to share their information with third parties.
  • BE WARY of legal loopholes that victimize customers and protect companies.

Reporting Fraudulent Activity or Scams

If you suspect you have been scammed, report your experience to the Federal Trade Commission at 1-877-832-4357 or reportfraud.ftc.gov

Daniel Klibanoff, an advocate for seniors, is currently serving as the President and CEO of Multimedia Lists, Inc. Daniel is also the founder and director of Elder Protective Services, an enterprise aimed to serve and protect elders. Learn more at Elder Protective Services.

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