Brokers selling travel insurance can expect less competition as one of the biggest financial institutions in the UK is planning to ditch its longstanding incentive for new customers.
According to a report by
The Sun Online, Nationwide will stop offering its annual free UK and European multi-trip travel insurance cover to new FlexAccount clients starting on December 15.
A Nationwide spokesperson told the news website that the travel insurance perk was being scrapped in order to “simplify” the company’s current account range.
“Although the FlexAccount current account remains popular, only a very small number of new customers go on to take the benefit,”
The Sun Online quoted the spokesperson as saying.
While new customers signing up after next week will no longer enjoy the benefit, existing FlexAccount holders will still get their free travel insurance cover, provided they continue to meet Nationwide’s eligibility criteria.
“Nationwide says it has no plans to stop covering customers who meet the eligibility criteria. So as long as it doesn't change its mind you are covered indefinitely,” consumer website
MoneySavingExpert said in a report.
Numerous banks and building societies have been cutting rates and perks on their accounts after the Bank of England slashed UK interest rates from 0.5% to 0.25% in August.
However, Nationwide’s move has nothing to do with that base rate cut, according to
MoneySavingExpert.
“Nationwide says the axing of free travel insurance for new customers was planned before August’s base rate reduction and is because fewer than 10% of its FlexAccount customers actually activate the free insurance,” the website reported.
The report added that Nationwide has no plans to terminate the £600 worth of travel, breakdown and mobile insurance on its FlexPlus account.
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