Michelle Monck

Michelle Monck

Consumer Finance Expert
Published: 14/01/2020

What is a packaged bank account?

A current account that includes additional products and services from the bank and other businesses is known as a packaged bank account. These usually include insurances, such as travel insurance, mobile phone or gadget insurance, car breakdown cover, retailer discounts and access to exclusive or loyalty products from the bank. There are 30 packaged bank accounts available (as of January 2020) from UK banks and building societies.

Five things to consider when choosing a packaged bank account

  1. Can you afford the monthly fee?
  2. Will you use the additional services provided?
  3. Will there be any exclusions that mean you cannot claim against the insurances offered?
  4. Do you have any other insurance policies with the same cover? Remember you can only claim against one policy.
  5. Will it save you money compared to buying the additional products separately?

What does your bank need to do when selling a packaged bank account?

  1. Make sure that you are eligible for the insurances included in the package.
  2. Tell you the costs of the packaged account each month.
  3. Make clear the key features and exclusions for the insurances included in the package.
  4. Provide an annual statement of eligibility.

 

How much does a packaged bank account cost?

Packaged bank accounts range in cost from free up to £75 per month. You may need to meet certain criteria to be eligible for some of the accounts, such as a minimum income or holding investable assets with the provider.

For example, the HSBC Premier account is the only packaged account without a monthly fee, but there are eligibility criteria to meet, including a minimum salary of £75,000, holding an HSBC International Premier account or having an investment of at least £50,000 with HSBC UK.  

The lowest fee for a packaged account is £10, but it does not provide any insurance cover. Nationwide’s FlexPlus account currently offers insurances for the lowest monthly fee at £13 per month.

Is opening a packaged bank account a good idea?

A packaged account may have benefits for you, for example if the services offered are ones that you would use and potentially pay more for separately. Moneyfacts has reviewed the packaged bank accounts available in the UK and rated these based on their introductory offers, incentives and value of their additional products and services. 

Highly rated packaged bank accounts

Click below to find out which packaged bank accounts got four and five-star ratings.

Choosing a bank account should also be based on how you intend to use your account – for example, do you need an overdraft as part of your account or do you plan to be in credit and want to earn interest on your balance? In addition, the way you want to bank is also important, for instance if you need to visit a branch to do your banking.

Why might the insurance not pay out?

When taking a packaged account, the bank account provider should check that all the insurances included are suitable for you. This means there should not be any exclusions that prevent you from claiming. Some examples include pre-existing medical conditions, maximum age limits and specific countries. 

How to get a packaged bank account

You can select those products and services you are looking for in a packaged bank account on our banking page.

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

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