People with titles do not necessarily use them in every situation, but make sure you err on the side of formality, particularly when dealing with the older generation.
You may need to do a little bit of homework to make sure you get the title correct.
In correspondence use the full title on the envelope.
In conversation a general guide when introducing peers or referring to them is to use Lord and Lady in the same way as you would use Mr and Mrs. Do not use their descriptive title such as the Earl of Lonsdale or the Marquess of Bristol. The only exceptions are dukes and duchesses who are spoken to as the Duke and Duchess of Marlborough, for example, and addressed as Duke and Duchess.