The same as a regular current account
A packaged current account isthe same as a regular current account,but it comes ‘packaged’ with additional services,such as insurance or other rewards. However,it does come with a monthly fee which you will have to pay in order to use the account.
What is a packaged bank account?
Typically, packaged bank accounts offer things like travel insurance, breakdown cover, mobile phone insurance, home emergency insurance, preferential overdraft rates, and/or travel-related discounts and freebies.
What is a packaged current account (ACA)?
A packaged current account is an account that will offer you perks such as insurance, breakdown cover, cashback on certain bills, free overdrafts, store discounts or exclusive interest rates paid on your savings. Often you will have to pay a monthly or annual fee for the account (or have to deposit a minimum sum each month).
What happens if you have insurance in a packaged account?
If a packaged account includes insurance, but you already have a separate policy, this can cause complications. If you are covered twice, some insurers will only pay out a share of the amount you claim.
How quickly can I open a packaged bank account?
Like ordinary current accounts, most high street banks offer the seven day switch guarantee, meaning that you can switch (along with all the associated direct debits and standing orders) within a week.
Are bank accounts with travel insurance for over 70s available?
Current accounts with travel insurance can offer a simple way to handle your banking needs and insurance in one place, however, not all accounts will insure all account holders. If you are over 70, make sure to check the terms and conditions of each packaged account to find out whether you are eligible for the travel insurance or whether additional cover is required.
Why are packaged bank accounts mis-sold?
Packaged account mis-selling. Because some people don’t qualify for some of the benefits they’re paying for, the FCA (Financial Conduct Authority) has investigated packaged bank accounts due to claims that they were mis-sold – in much the same way that PPI was.
What to do if you think a packaged account is right for you?
If you think a packaged account might be right for you, grab your calculator and tot up what you are currently paying, or what you would pay elsewhere, for the various benefits on offer. Then consider which (if any) of the elements you might need within the next year, and what they might cost.
Why would it cost more to buy a packaged account?
The separate elements in a packaged account would cost you more if you bought them individually, because each organisation you purchased from would have their own costs and profit. Simply acquiring a new customer can be an expensive process. However, everyone needs a bank account, so organisations who partner with your bank can dramatically reduce what it costs to get new customers, and these savings can be passed on to you – in a similar way to group buying.
How long does it take to switch a bank account?
Since the advent of the current account switch guarantee, swapping your bank account has never been easier. It can be done quickly and painlessly in just seven days. This is great for you, but less so for the high street banks.
Do banks lose money on packaged accounts?
Usually, the combined cost of the various elements contained within a packaged account exceeds the annual fee, so are banks losing money on these accounts? Unlikely. But they’re not making much either.
What is a packaged current account?
A packaged current account provides all the usual services a standard current account offers, but additionally includes benefits like insurance, breakdown cover and other types of perks like a free or discounted overdraft or discounts at certain restaurants.
How do I know if I have a packaged bank account?
To check if you have a packaged bank account (PBA), take a look at your bank account statements to see if you can find a transaction described as a ‘bank account fee’.
When did packaged bank accounts start?
Packaged bank accounts were first introduced during the 1990s when the main features of a premium current account allowed customers to acquire more affordable overdrafts and pay lower credit interest on their accounts. 20 to 30 years ago, overdraft interest rates were much higher and a nominal fee payable for a packaged account …
Does travel insurance cover skiing?
For example, travel insurance will not always cover extreme sports like skiing or abseiling.
Does insurance cover joint bank accounts?
Some offer access to financial products you wouldn’t otherwise have access to. Insurance doesn’t always provide the cover you need (i.e. insurance for extreme sports or medical conditions) Can work out much cheaper for joint bank accounts.
Is a joint bank account more cost effective than a single bank account?
Joint bank accounts work out more cost-effective than single packaged accounts, especially if you both separately pay for mobile phone insurance and breakdown cover, and travel abroad at least once a year. To help you decide, below is a summary of some of the advantages and disadvantages of having a packaged bank account.
What must a bank do?
What your bank must do. Your bank or building society must make sure you are aware of the cost of your account. They should also take reasonable steps to check whether you would be eligible to make a claim on each insurance policy provided by the account.
What is a packaged bank account?
A packaged bank account is a current account that comes with other goods or services. Generally, these include at least one insurance product (such as travel or mobile phone insurance), but they may also include a range …
What is an annual eligibility statement?
Your bank should also give you an annual eligibility statement. This will set out the eligibility requirements for each of the insurance policies in the account.
Do you have to pay monthly for a bank account?
Generally, these include at least one insurance product (such as travel or mobile phone insurance), but they may also include a range of other non-insurance goods or services (such as airport lounge access). You usually have to pay a monthly fee for a packaged bank account.
Can you make a claim on one insurance policy?
If you do, you may end up paying twice, but will usually only be able to make a claim on one policy
Packaged current accounts offer a vast array of benefits – for a monthly fee. When are these accounts actually worth the money?
Everyone likes to feel a little bit special, and the idea of being part of an exclusive club is one that many of us aspire to — something financial services providers are well aware of.
This week Abbey has launched a new packaged current account, the Reward Bank Account, available to new and existing customers.
But what exactly is a packaged current account?
Packaged current accounts are offered by most mainstream banks for a monthly fee, which averages £13.87 according to financial information provider Defaqto, up from £10 in April 2006.
The benefits of packaged current accounts suit some people more than others — homeowners, car owners, and those that travel abroad regularly tend to be able to make better use of the perks and freebies.
Are they worth it?
However there is one big, obvious drawback to a packaged current account. Unlike standard current accounts, you have to pay for them. A monthly fee of approximately £13 means an annual spend of over £150, which of course is only worthwhile if the value of the benefits outweigh the cost — and if you actually want those benefits.
High rollers only
On top of the monthly fee there is sometimes a minimum income requirement with packaged accounts. You may need to fund your account with a minimum amount — Alliance & Leicester’s Premier current account requires a monthly sum of £500 (but has no monthly fee), for example.
The value of special rates
One attraction of packaged accounts is the preferential rates you can access. Not only does this make you feel special it can come in handy if you need to borrow.
What benefits can I enjoy with a current account?
The main reason to get a packaged account is to take advantage of the free benefits that come with the account. You could enjoy:
What does ‘most popular’ mean?
Bank accounts on this table are ranked by popularity, which we have judged according to how many clicks they got over the past 48 hours. Those with the most clicks are at the top of the table, and those with the least at the bottom.
Where are the most clicked on accounts on Uswitch?
The most clicked on accounts are at the top, with the least at the bottom. This reflects how popular they are with visitors to Uswitch.com. Consequently, this is a good table to look at if you’re interested in seeing which current accounts most people think are worth getting.
Is Uswitch a lender?
Uswitch Limited is a credit broker, not a lender, for consumer credit.
Do AER accounts pay higher interest?
Higher interest rates – Some accounts pay higher than typical AER, but often this will only be paid on balances up to a limited amount.
Do banks give discounts?
Discounts – Many banks have partnerships or deals with high-street retailers and will give you exclusive discounts, bank accounts provided by retailers often will include a scheme paying loyalty points for spending in-store.