Packaged bank accounts

Travel insurance, mobile insurance and breakdown cover, all included in your current account. Sounds great, but will it actually save you money?

Comparing hundreds of products for each of your financial needs can be exhausting (we should know). So the idea of getting travel insurance, device insurance and breakdown cover with your bank account, all for one simple monthly fee, certainly sounds appealing.

Sometimes it can also be the cheapest choice, but a lot depends on your personal circumstances; we’ve broken down all the typical features of packaged bank accounts to help you figure it out.

Compare packaged bank accounts

Name Product Ratings Account fees Funding requirement Interest (AER) Arranged overdraft Incentive Representative example Link
HSBC
We say
★★★★★
★★★★★
You say
★★★★★
★★★★★
£0
No minimum funding requirement
0% AER
N/A
£125 for new accounts when a minimum of two Direct Debits or Standing Orders are switched using the Current Account Switching Service within 30 days of account opening.
View details
Danske Bank
Not yet rated
£0
No minimum funding requirement
0% AER
0% EAR variable
Commission free currency.
Representative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 0% EAR variable.
View details
Barclays
We say
★★★★★
★★★★★
You say
★★★★★
★★★★★
£12.5 per month
No minimum funding requirement
0% AER
N/A
Free.
View details
Barclays
We say
★★★★★
★★★★★
You say
★★★★★
★★★★★
£12.5 per month
No minimum funding requirement
0% AER
N/A
Free.
View details
Nationwide BS
We say
★★★★★
★★★★★
You say
★★★★★
★★★★★
£13 per month
No minimum funding requirement
0% AER
39.9% EAR variable
Free.
Representative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 39.9% EAR variable. Account fee of £13 per month.
View details
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What is a packaged bank account?

A packaged bank account is a current account that comes with a set of benefits and perks in return for a monthly fee.

The advantage is that you’re all sorted and don’t have to worry about purchasing insurance separately. The disadvantage is that it may not necessarily be the cheapest option.

Which benefits can I get with a packaged bank account?

It depends on the account, but you normally get a range of insurance options plus, in some cases, some extra rewards or perks.

Current accounts with travel insurance

Travel insurance is a standard feature of packaged accounts. Whether it’s cheaper purchasing it separately mostly depends on how often you travel.

You should also consider that in some cases, the travel insurance provided by the account has an age limit, so if you’re beyond that, you won’t be covered. Finally, always let your bank know if you have any pre-existing medical conditions because they may not be covered by the policy.

Current accounts with device insurance

Most packaged accounts also have device or mobile phone insurance. Depending on the cover, this means that if your phone (or laptop if included in the policy) is lost, damaged or stolen, you’ll be able to submit a claim and get some money back.

Needless to say, whether it’s worth ensuring your device will mostly depend on how much the device itself is worth. However, also consider the economic costs that could arise if you lost important data you had on your device (which of course will not happen because you have a full backup of those someplace safe… right?).

Current accounts with breakdown cover

Another common feature of packaged current accounts, breakdown cover is highly recommended if you drive often, especially if your not-so-new car has seen better days. Knowing that if it breaks down you can call for help without it costing you a fortune can give you great peace of mind.

However, breakdown cover is also a pretty standard car insurance feature, so you should definitely check that you aren’t already paying for it anyway.

Extra rewards

Some packaged accounts also allow you to earn extra rewards or discounts. Now, those won’t be enough to justify the monthly fee on their own, but it can help you make a choice if you’re unsure.

For example, you could be able to earn cashback on your household bills or get a discount when you shop at certain retailers.

Are packaged accounts worth it?

That’s the million dollar question. There’s no universal answer, but here are a few things you should think about that can help you figure it out:

  • How much does the account cost per year? It’ll help you when it comes to comparing the account to purchasing insurance independently.
  • Will you actually use the benefits? This can be broken down into: how often do you travel? Is your phone worth insuring? Do you drive at all?
  • Are you already covered? Breakdown cover could be included in your car insurance, mobile insurance could come with home insurance if you have one, and some credit cards also offer travel insurance.
  • Which level of cover do you need? Packaged accounts tend to provide high cover levels, but in many cases you may be just fine with a less comprehensive policy.
  • How much will it cost to purchase insurance independently? The only way to find out is getting independent quotes for the insurance products you need and then compare the costs.

Finally, don’t forget that your time is worth something. If purchasing insurance independently will only save you a few pounds and is a much more of a hassle, it may be worth just going for the packaged account and forgetting about it.

Pros and cons of packaged bank accounts

Pros

  • Great peace of mind because you’re fully insured 12 months a year.
  • One straightforward monthly fee.
  • Don’t need to purchase insurance separately every time you travel.
  • High-end cover levels.

Cons

  • You may not need all the benefits, in which case it isn’t great value for money.
  • Other accounts may offer better rewards (such as interest on your balance).

Frequently asked questions

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

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