Citi to Remove Automatic Travel Insurance
Tip It!I recently learned that Citi is removing the automatic travel insurance from their cards, effective September 1, 2009. If you’re anything like me, then I know exactly what you’re thinking…
“Travel insurance? What travel insurance?”
To be completely honest, I was vaguely aware of this coverage, but my card usage is primarily governed by one thing — credit card rewards — so I’ve never paid much attention.
Whether you know it or not, if you’ve booked travel on any “common carrier” using your Citi card, you’ve been automatically covered by this insurance. Here’s a description of the coverage, straight from Citi:
“When you use [select Citi cards] to buy plane, train, ship or bus tickets, you, your spouse and eligible dependent children are each automatically covered for up to $1,000,000 of Automatic Travel Accident Insurance, at no additional cost to you.”
Now that you know about it, will you miss it?
While I realize that this isn’t necessarily an either/or proposition, I’d prefer to see perks like this get dropped rather than having card issuers reduce their reward programs, institute new fees, etc.
Published on August 31st, 2009 - 7 Comments
Filed under: Credit Cards
About the author: Nickel is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!
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August 31st, 2009 at 1:31 pm
When my husband and I went to Japan for our honeymoon, we intentionally signed up for United’s credit card specifically for the travel insurance. Expecting to not need it, we did not read the fine print, which, was to our peril. 1/3 of the way through the trip I broke my foot and we had to cancel the rest of the trip and fly home. Bummer was the fine print only covers your trip if you are injured “while traveling” like on a mode of transportation. Since I was walking, not on a train, plane, bus, all the expenses came out of our pockets and we could not afford to go back until we saved two more years. Now I opt for *real* travel insurance when we plan expensive once-in-a-lifetime trips. For $200 it was nice to know when we went back if anything happened we would get to go back for free. Of course, nothing did that time.
So mostly I think it is a benefit most people won’t really benefit from except in a very rare occasion.
August 31st, 2009 at 3:16 pm
It’s really sad that companies have had to start cutting back or cutting out many of the services they previously offered to customers just to stay afloat – especially a service as important as insurance. It has been my experience that insurance is like extra napkins – if you get it you won’t need it (most of the time) but if you don’t you’ll wish you had.
August 31st, 2009 at 3:34 pm
I’m surprised they cut this one out. There can’t be that many people who know about it, let alone use it. Unless their premiums for it were ultra expensive, it just seems like this is something that wouldn’t go up much b/c I can’t imagine it being used frequently.
August 31st, 2009 at 4:52 pm
A lot of cost cutting is needed if they are going to pay the $100 million bonus to their energy trader, Andrew Hall! Working for a government assisted bank isn’t that bad.
August 31st, 2009 at 6:01 pm
It’s not total, Citi is just cutting back on the amount of travel insurance they provide:
http://www.americanbanker.com/.....525-1.html
August 31st, 2009 at 11:33 pm
Yeah my letter said it’s being reduced from $1 million to $250 thousand starting October 1st.
September 1st, 2009 at 5:36 pm
@RB – 100 million sounds like a lot, but it’s really peanuts compare to many billions in losses or expected losses. Plus, if I understand it correctly, the particular trader brought Citi a whole lot more money than this bonus. If Citi loses him as well as others it may lose more in future profits. Not to mention that nobody would want to work for company that doesn’t honor its contracts. Talking about cutting one’s nose…
With credit card business no longer being as profitable as it used to, it’s no surprise that benefits are getting cut.