Top Packaged Bank Accounts
Get £500+/yr of breakdown, travel & mobile insurance for £156/yr
Packaged bank accounts are the Marmite of banking – some love 'em, some hate 'em. They usually have a monthly fee but, used right, they can save you £100s off the cost of breakdown, travel and mobile insurance. Our guide will help you check a packaged account is right for you, and then run you through the top pick accounts.
The five need-to-knows
Packaged bank accounts usually provide breakdown cover, mobile and travel insurance for a monthly fee. But, before you get an account, read these need-to-knows – they'll help you check this type of account is right for you. If it's not, head to Best Bank Accounts to see the top standard bank accounts.
1. These accounts can be great value, but check if you NEED the insurance, and if so, whether you can buy it cheaper elsewhere
For some, travel insurance, smartphone cover and a breakdown policy for a fixed monthly fee won't be worth it. But if you're savvy enough to check policies and work out costs, they can SAVE you money. There's a simple way to work it out:
If you don't need the insurances, or can insure cheaper elsewhere, don't bother with a packaged account.
Start by multiplying the monthly cost of the account by 12 – for example, £15/month is £180/year – then see if you can buy the 'freebies' for less. To help, see our Travel Insurance, Breakdown Cover and Mobile Insurance guides. The policies included with packaged accounts are deliberately high-end, so compare whether a decent standard policy covers what you'll need.
If you'd make a saving, a packaged account might be worth it for you. If you wouldn't, paying for cover separately and plumping for a fee-free bank account could work better.
2. If you're in a trusting relationship, you can also add your partner as a joint account holder to add even more value
With most packaged accounts the perks are valid for all account holders for the same single fee. Open it jointly and you're both covered, essentially boosting the account's value. So even if you won't both use the account, adding a partner can make sense (though be aware that joining finances means their credit record can affect yours).
You should still consider what policies you actually need, and whether you could get 'em cheaper elsewhere, but if you both travel worldwide, own cars and have smartphones, a packaged account could save you money.
3. Ensure the insurance policies cover everything you need – and check what cover the travel insurance provides for coronavirus
If they aren't going to pay out when necessary, they're worthless, so always check when signing up for an account.
Check what cover the account's travel policy offers for coronavirus. Most will cover it medically if you need treatment overseas, or if you need to cancel your trip as you've tested positive for coronavirus in the days before you were due to go.
However, you generally won't be covered if your area's in lockdown meaning you can't travel, or your destination has restrictions. We've marked in each bank's review what the travel policy covers.
Always watch out for upgrade charges. If winter sports and family cover aren't included, adding them can have hefty costs and you could find you're spending far more than you need to. Instead, choose a more suitable account to begin with, or save by insuring separately.
Failing to declare conditions when applying for an account – and therefore, the travel insurance cover, too – may invalidate the policy. You need to call the insurer and tell it, even if you're just having tests for a condition.
If you're diagnosed, or anything changes after the policy has been taken out, tell the insurer before you travel. It'll decide if it'll still cover you, with or without an additional charge. This will be reviewed annually, for as long as you hold the account, although it may not provide cover under the same conditions each year.
This guide's about how to pick the best packaged account. But it's worth noting that many people have had them for years without being able to use the benefits, essentially because they were mis-sold the account.
If that's you, see our Reclaim Packaged Account Fees guide. EVERYONE who pays a monthly bank account fee should CHECK NOW to see if they were mis-sold.
Best buys: Packaged bank accounts
There are a whole host of packaged bank accounts out there, but you have to be careful that the one you choose gives you value for money, especially if you're still driving less and taking fewer overseas trips as a result of the pandemic.
In terms of our top picks, Nationwide offers the most comprehensive cover for a low monthly fee, but there are a couple of other decent options...
Top for families: get up to £500/yr-worth of mobile phone, travel & breakdown cover for £156/yr
Nationwide's FlexPlus* account is a strong deal - especially for families - provided you'll use the features. It also has the lowest monthly fee of our top-pick accounts at £13/mth. That covers:
- Smartphone insurance for all the family's phones
- UK & Europe breakdown cover for the account holder(s)
- Worldwide family travel insurance, including winter sports, up to your 70th birthday (you can pay an additional £65/yr to keep the cover if you're older)
We've calculated that in total the insurance could be worth £500+/yr for a family of four. Read more info on the insurances, incl what Covid cover the travel insurance offers.
How Nationwide rates on
DATE: FEB 2021. VOTERS: 518
Top for couples & for older travellers – £400+/yr of travel, mobile & breakdown cover for £180/yr, though you can make it cheaper
Co-op Bank's Everyday Extra account is a top pick for older travellers, and could also suit couples well. At £15/mth it's a touch more expensive than Nationwide, but Co-op does offer 'Everyday Rewards' which can give you up to £5/mth back (up to £2.20/mth back from 1 July). With this account, you get:
- Smartphone insurance for the account holder(s)
- UK & Europe breakdown cover for the account holder(s)
- Worldwide family travel insurance up to your 80th birthday, including winter sports (max age 64 for winter sports cover).
We've calculated that in total the insurance could be worth £400+/yr, though older travellers may find it valuable for the travel insurance alone. Read more info on the insurances, incl what Covid cover the travel insurance offers.
How do I get £5/mth back? You'll get £2 back each month you pay in £800, pay out four direct debits, stay paperless, log in to online/mobile banking, and stay in credit or within your overdraft limit. Plus you can get an additional 5p per debit card transaction (max £3/mth, which is 60 card transactions).
How Co-op Bank rates on
DATE: FEB 2021. VOTERS: 105
Good if you also want home emergency cover – £400+/yr of mobile, travel, breakdown & home emergency cover for £204/yr (though you can make it cheaper)
Another decent option is the Halifax Ultimate Reward account, though it's the most expensive of our top picks. The account fee is £17/mth, but you can get a selection of monthly rewards, one of which is £5/mth which you can use to offset the fee. With this account, you get:
- Smartphone insurance for the account holder(s)
- UK breakdown cover for the account holder(s)
- Worldwide family travel insurance up to your 71st birthday, including winter sports.
- Home emergency cover
We've calculated that all the insurance could be worth £400+/yr. Read more info on the insurances, incl what Covid cover the travel insurance offers.
How do I get the monthly rewards? You get a choice of £5 cash, three magazine subscriptions, two digital movie rentals or one cinema ticket each month. Yet, there are several criteria to fulfil to get your chosen reward so read the full Monthly Rewards info.
How Halifax rates on
DATE: FEB 2021. VOTERS: 239
Top premium bank accounts
While you can pay for the accounts above, most banks also have a 'premium' account. This is generally for people earning high salaries (usually £75,000+) or who have significant investments or mortgage borrowing.
These premium accounts are generally seen as a halfway house between the paid-for accounts above, and proper private banking. Perks associated with the accounts vary. Some include insurance, access to concierge services, or discounts on mortgages or other associated products.
Here are our top picks...
Free worldwide family travel insurance, though you need a high salary, or £50,000+ saved/invested with HSBC
The HSBC Premier account's worth getting if you bank with HSBC and you meet the account opening criteria, namely that you either:
- Earn £75,000+ and have an HSBC mortgage, investment or life insurance product
- Have £50,000 saved or invested in an HSBC product
If either of these apply to you, and you open the Premier account, you get free worldwide family travel insurance up to your 70th birthday. Read more on what's covered, incl the Covid cover offered.
You can also transfer cash fee-free between different HSBC accounts you hold in different countries using its Global Transfers service. Plus being a Premier customer gets you discounts on other products, eg HSBC mortgages.
How HSBC rates on
DATE: FEB 2021. VOTERS: 318
If you have cause to bank in different currencies, the Citigold account from Citibank could be a good option. You get:
- Free US dollar and euro accounts, as well as a Sterling account
- Fee-free transfers to other Citi accounts in 20+ countries
- Worldwide family travel insurance up to your 80th birthday (read more on what's covered)
It's fee-free if you maintain a minimum average monthly balance of £150,000 across all accounts held with Citi UK or if you hold an account with Citi International Personal Bank in London or Jersey. Otherwise it's £75/mth.
Monthly fee: None, or £75/mth if you don't meet the account criteria
Min monthly pay-in: None (but must have avg monthly balance of £150,000 with Citi)
Arranged overdraft cost: 0% on the first £500, then 9.9% EAR
Unarranged overdraft cost: £10 buffer then £25 per paid or unpaid item (max £100)
Does it have full FSCS savings protection? Yes
Packaged bank account FAQs
Banks use the same credit-scoring procedures, where they assess whether they want you as a customer, for packaged accounts as they do with normal accounts. For more info on how this works, and what lenders are looking for, see Credit Scores.
Usually, no. It's automatic. But if action is needed, we'll highlight it in the need-to-knows.
Some packaged accounts, such as Halifax Ultimate Reward, pay their rewards with basic-rate tax already deducted.
With the introduction in April 2016 of the personal savings allowance (PSA), meaning interest is now paid tax-free, some people hoped that they'd see an increase in the reward amounts paid to them.
But these payments don't count as savings income for tax purposes and instead are classed as 'annual' or 'miscellaneous' payments. This means the rewards don't count towards your PSA, and they're still liable to be taxed.
If you're a non-taxpayer, you should claim back any tax taken using the R40 form. Higher and additional-rate taxpayers may need to pay more via tax returns.
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