Going Abroad Beware Of Extra Credit Card And Car Insurance Charges
20 March 2008 / by None
As millions of UK holidaymakers head abroad for their Easter holidays they are risking some unpleasant surprises on their return, according to uSwitch.
The majority of Brits are blissfully unaware of the extra costs they might incur both for using their debit and credit cards abroad and extended car insurance cover for driving abroad.
The research from uSwitch shows that, in total, Britons will spend £23 billion on plastic this year while abroad for which they will be charged a whopping £686 million by their banks.
While most customers know that there is an exchange rate fee and a cash withdrawal fee, which amounts to about 1.50 per cent on debit cards and 2.67 per cent on credit cards, the majority of Britons is completely unaware that English banks now charge an average fee of £1.19 for every single overseas debit card transaction.
An example given by uSwitch: if during your two week holiday you pay for 14 meals on your debit card and are charged transaction fees of up to £1.50 each time, you will end up paying an extra £21 – and that’s only for meals.
Mike Naylor, personal finance expert at uSwitch.com, warns: “The ever-increasing plethora of overseas fees and charges on debit and credit cards could leave consumers with a holiday hangover if they don’t do their homework before boarding the plane. Charging a fee for every purchase made overseas on a debit card is a lucrative bandwagon and one that is well worth providers jumping on.”
He recommends: “Any consumer who holds a debit card with a bank levying these charges should think carefully before handing their card over the counter whilst abroad.”
According to uSwitch, the most cost effective way is to take out larger amounts of money and pay in cash in order to minimise transaction and withdrawal fees or take some local currency with you that has been exchanged without commission.
uSwitch also urges British holidaymakers who are planning to drive abroad to check their car insurance cover. A second study conducted by the price comparison site found that a 68 per cent of all Britons are completely ignorant of the level of their cover, and their dream holiday could turn into a nightmare should they have to make a claim.
“It isn’t only sun cream protection that holidaymakers need to worry about when driving abroad this year.”, Ashton Berkhauer, insurance expert at uSwitch.com, comments.
“Consumers should look at the level of cover on offer and watch out for any restrictive clauses as to the number of consecutive days a car can be driven abroad before the driver must return to the UK.”
Policies differ considerably on the number of free days they offer for driving abroad, but it could be prove costly to extend that period – in one case the extension of cover over the free period of 60 days cost a whopping £510.
Under EU law, all car insurance providers are obliged to offer third-party only cover when driving abroad, butsome policies don’t cover theft, accidental damage or personal injury. Therefore, in order to avoid unpleasant surprises, warns uSwitch, make sure your policy includes comprehensive ‘foreign use’ if you want to take your car abroad.
© Fair Investment Company Ltd