Originally published April 7 2005
Check your credit cards' fine print before relying on them for travel insurance and other benefits
by Mike Adams, the Health Ranger, NaturalNews Editor
Many incentives that people have come to take for granted from their credit card providers are now disappearing. Card benefits used to include travel insurance, extra purchase protection, and cheap balance transfers, but providers are now beginning to remove these benefits, especially travel insurance. Consumers should now more than ever be sure to read the fine print and monitor their spending, as many credit card providers are constantly changing their benefits.
CREDIT card providers have used incentives such as travel insurance, extra purchase protection and cheap balance transfers to attract customers.
Halifax is the latest company to remove travel insurance provision from new credit card applications, while Sainsbury's Bank withdrew travel accident insurance from all its cards from March 1.
Other card issuers are likely to go the same way - an unintended consequence, perhaps, of the move to bring the regulation of travel insurance under the aegis of the Financial Services Authority, except when sold by travel agents.
Among other disappearing benefits, Alliance & Leicester is withdrawing its cashback offer and a number of card issuers are reducing the level of purchase protection they offer to that required by law and no more.
Customers also need to watch out for additional card charges.
According to Nationwide Building Society, credit card providers make �500m in profit every year from the way they allocate payments made to accounts.
Almost all UK card providers allocate payments in the first instance to outstanding balances at the lowest rate of interest - for example, 0% balance transfers - leaving balances at higher interest rates, such as purchases and cash advances, to continue to accrue interest.
Its main reason was to highlight the fact that it claims to be the only major credit card provider that applies payments to the most expensive debt first, across all its credit cards.
Because of this tactic on the part of the card provider, the debt on any credit card becomes more expensive for the cardholder and more profitable for the provider.
Repay �400 at the end of the month and you may assume your spending is covered and you will be charged no interest.
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