What do you think?

[MaggieD]

Chase Bank's credit card has a feature where you can pay 1% of your card balance to insure that, should you die, your balance will be paid in full. They have elected to cancel that feature. To sweeten the deal, they're giving their customers one-year's notice and one-year's free benefit...so I guess that means you hope you die before the year is up.

This article is about a 95-year-old lady who has a $38,000 balance on her Chase card, has made her payments religiously and bought the protection. The media picked it up when she complained to Consumer Protection. She's paid over $16,000 in premiums to Chase for this coverage over the years.

Fair to cancel?

I say they are completely free to stop selling it, but cancelling it for those who are already enrolled? I say no.

You?

Chase Cancels Payment Protector Plan, Leaving Many in the Lurch - ABC News

 

[Gipper]

Chase Bank's credit card has a feature where you can pay 1% of your card balance to insure that, should you die, your balance will be paid in full. They have elected to cancel that feature. To sweeten the deal, they're giving their customers one-year's notice and one-year's free benefit...so I guess that means you hope you die before the year is up.

This article is about a 95-year-old lady who has a $38,000 balance on her Chase card, has made her payments religiously and bought the protection. The media picked it up when she complained to Consumer Protection. She's paid over $16,000 in premiums to Chase for this coverage over the years.

Fair to cancel?

I say they are completely free to stop selling it, but cancelling it for those who are already enrolled? I say no.

You?

Chase Cancels Payment Protector Plan, Leaving Many in the Lurch - ABC News

They're "free" to do most anything they want (if legal). However, they will have to deal with the fallout.

Dick Durbin will tell you all about that.

 

[MaggieD]

They're "free" to do most anything they want (if legal). However, they will have to deal with the fallout.

Dick Durbin will tell you all about that.

You're batting a thousand on my threads this morning, Gipper. :rofl

 

[Gipper]

You're batting a thousand on my threads this morning, Gipper. :rofl

Fair to cancel. End post.

 

[tech30528]

The banks are criminals. As luck would have it, you don't have to participate. No, seriously, you don't need to live on borrowed money. She could have kept that $16,000.

 

[Helix]

no, they shouldn't be allowed to cancel it for existing customers. that's like paying into a pension for your whole life and then having it rolled into some worthless plan at the last minute.

of course, the deck isn't stacked in favor of consumers or workers.

 

[Lord Tammerlain]

If they are going to cancel it for all people it is fine. But to cancel it for only certain individuals no

As for the 95 year old, it looks like she is racking up CC debit with no intention of paying it back (ie to die and have the debt cancelled)

 

[tech30528]

no, they shouldn't be allowed to cancel it for existing customers. that's like paying into a pension for your whole life and then having it rolled into some worthless plan at the last minute.

of course, the deck isn't stacked in favor of consumers or workers.

Everybody hearing about this who is disappointed about it and does business with Chase should pull their business and be sure to explain to your customer service person (assuming you can reach one) why that is. It's the only way to make these companies change their policies. A stock dump would be even better.

 

[tech30528]

Back when I had a mortgage it was with Washington Mutual. We were behind due to our only income coming from a then new business while my wife was in school. We worked out a modification plan with them and went thru it all, completing all the reduced payments and were waiting for the paperwork for the new 30 year mortgage to arrive. By then we could afford the payments. That was about the time Chase was given Washington Mutual (I say given because Chase got the money to purchase it by the government and paid them back by foreclosing as many homes as they could and handing them over to Fannie Mae). We got a call from Chase stating that we were behind on the mortgage. We explained that we had just gone thru modification and were waiting on the paperwork, they claimed they had no record of that. I faxed them all of the paperwork, all 60 or so pages of it. They told us that we would have to start over with a new modification and then promptly foreclosed. It took 7 weeks from the time Chase took over WaMu.

At the time my credit card processing was thru Chase to the tune of about $125,000 a year. I dumped them, and explained why. I also talked to other business owners, and 6 of them did the same thing. Don't know what Chase missed out on altogether, probably not enough to care about, but it made me feel better. Since then I have gotten sales calls from Chase wanting to loan us money and handle our processing. I informed them that they were to never call me again, and if they did I would prosecute them for harassment. Then I blocked their number.

 

[KevinKohler]

If they are going to cancel it for all people it is fine. But to cancel it for only certain individuals no

As for the 95 year old, it looks like she is racking up CC debit with no intention of paying it back (ie to die and have the debt cancelled)

Which is the only logical thing to do should you be enrolled in such a program, and frankly, the bank should have realized that before rolling this thing out.

 

[KevinKohler]

Depends on what's in the contract. Last I checked, contract violation is illegal.

 

[tech30528]

If they are going to cancel it for all people it is fine. But to cancel it for only certain individuals no

As for the 95 year old, it looks like she is racking up CC debit with no intention of paying it back (ie to die and have the debt cancelled)

Chase developed and offered the plan, she just accepted it and paid them according to their terms. Regardless of her intentions, she was playing by their rules. They stole $16,000 from her in premiums and then refused to hold up their end. If there is ever a zombie apocalypse I'm shooting the ones in expensive suits first whether or not they are zombies.

 

[tech30528]

Which is the only logical thing to do should you be enrolled in such a program, and frankly, the bank should have realized that before rolling this thing out.

Unless they had no intention of honoring it, and honor is a foreign concept to banks.

 

[Helix]

Everybody hearing about this who is disappointed about it and does business with Chase should pull their business and be sure to explain to your customer service person (assuming you can reach one) why that is. It's the only way to make these companies change their policies. A stock dump would be even better.

sometimes it isn't that easy. i planned on boycotting BoA for life after they screwed a friend of mine on loan interest. then BoA bought the company that i've had a credit card with since 1996. as i understand it, if i dump the card, it could have a negative effect on my credit score somehow. i assume the same holds true for those who have chase credit accounts. about the only thing i can do with it now is to use it as little as possible and never carry a balance.

 

[Lord Tammerlain]

Chase developed and offered the plan, she just accepted it and paid them according to their terms. Regardless of her intentions, she was playing by their rules. They stole $16,000 from her in premiums and then refused to hold up their end. If there is ever a zombie apocalypse I'm shooting the ones in expensive suits first whether or not they are zombies.

They did not steal the $16 000, during the time of the program she was covered if she dies tomorrow her CC debit will be cancelled to whatever limit it has. It is more like term life insurance rather then whole life. I also expect the contract allows for the termination of the program at any time, provided they have given enough notice.


Neither side have played fairly in this case. The old woman was gaming the system to her advantage. I strongly doubt it was expected to be used by elderly people who were going to rack up CC debit with the hope of dieing before they had to pay off the debt. The company cancelling the program when it realized it was not a money maker like they expected.

I have been offered similar programs with my CC, which I have turned down. Generally because I do not carry a balance and dislike paying interest or extra fees in general

 

[davidtaylorjr]

Chase Bank's credit card has a feature where you can pay 1% of your card balance to insure that, should you die, your balance will be paid in full. They have elected to cancel that feature. To sweeten the deal, they're giving their customers one-year's notice and one-year's free benefit...so I guess that means you hope you die before the year is up.

This article is about a 95-year-old lady who has a $38,000 balance on her Chase card, has made her payments religiously and bought the protection. The media picked it up when she complained to Consumer Protection. She's paid over $16,000 in premiums to Chase for this coverage over the years.

Fair to cancel?

I say they are completely free to stop selling it, but cancelling it for those who are already enrolled? I say no.

You?

Chase Cancels Payment Protector Plan, Leaving Many in the Lurch - ABC News

I would say it would depend on what the original terms of the agreement were. Most of those things say they can be changed or cancelled at any time, people just don't read them.

That being said, $38,000 of credit card debt is irresponsible anyway for an individual. The article makes it sound like she only ran the balance up that high because of the plan. So she took money with no intention of paying it back.

 

[CanadaJohn]

Chase Bank's credit card has a feature where you can pay 1% of your card balance to insure that, should you die, your balance will be paid in full. They have elected to cancel that feature. To sweeten the deal, they're giving their customers one-year's notice and one-year's free benefit...so I guess that means you hope you die before the year is up.

This article is about a 95-year-old lady who has a $38,000 balance on her Chase card, has made her payments religiously and bought the protection. The media picked it up when she complained to Consumer Protection. She's paid over $16,000 in premiums to Chase for this coverage over the years.

Fair to cancel?

I say they are completely free to stop selling it, but cancelling it for those who are already enrolled? I say no.

You?

Chase Cancels Payment Protector Plan, Leaving Many in the Lurch - ABC News

I'd make two points:

1. What the hell is a 95 yr old woman doing with a $38,000 balance on one credit card, let alone on a total of all credit cards? Seems to me that she's been paying the 1%, expecting to die, so that she could cheat the company out of the debt she's accumulated at their expense. Shame on her. And that's not taking into account the stupidity of the whole scheme. Are we supposed to feel sorry for her because she's 95?

2. The bank is free to make any change in policy on its cards or services it wants. People can't expect to get the same interest rate forever as when they signed up - bank service charges change frequently. These credit card payment features are designed to assist people who lose a job or die suddenly, not as a get free stuff life insurance policy.

 

[FederalRepublic]

I remember when they tried to sell me this plan. Why in the hell would anybody voluntarily buy a life insurance policy from a credit card company that pays the credit card company in the event of their death? You're paying to insure them for their loss!

 

[MaggieD]

I'd make two points:

1. What the hell is a 95 yr old woman doing with a $38,000 balance on one credit card, let alone on a total of all credit cards? Seems to me that she's been paying the 1%, expecting to die, so that she could cheat the company out of the debt she's accumulated at their expense. Shame on her. And that's not taking into account the stupidity of the whole scheme. Are we supposed to feel sorry for her because she's 95?

2. The bank is free to make any change in policy on its cards or services it wants. People can't expect to get the same interest rate forever as when they signed up - bank service charges change frequently. These credit card payment features are designed to assist people who lose a job or die suddenly, not as a get free stuff life insurance policy.

Now that several posters, including you, have mentioned it, I think there's definitely something else going on here. First of all, most people in her age demographic hate credit. But let's even put that aside. She was in her late 80's accumulating this $38,000 debt. Want to bet it was her family doing it for their own benefit?

Dollars to donuts that's "The Rest of the Story."

 

[MaggieD]

I remember when they tried to sell me this plan. Why in the hell would anybody voluntarily buy a life insurance policy from a credit card company that pays the credit card company in the event of their death? You're paying to insure them for their loss!

Well, you're right about insuring their loss -- UNLESS you have that kind of money. Your estate must pay all bills after your death.

I must admit, though, one could have $2 million in assets and very easily structure them so there was no money available to pay any debt at all. Maybe her family should get busy with Plan B. :rofl

 

[clownboy]

Those who have paid and are willing to continue paying that 1% should be grandfathered in.

 

[CanadaJohn]

Now that several posters, including you, have mentioned it, I think there's definitely something else going on here. First of all, most people in her age demographic hate credit. But let's even put that aside. She was in her late 80's accumulating this $38,000 debt. Want to bet it was her family doing it for their own benefit?

Dollars to donuts that's "The Rest of the Story."

I agree - old people hate credit - I hate credit now that I'm retired and I'm only 57. I hadn't thought about what you suggest above, but you could be right. There are a lot of "families" who take advantage of older relatives in this way. Wouldn't suprise me if the kids raked up the debt and got the insurance so that when mom passed they'd be off the hook. It's sad to think this way, but you make an excellent point.

The other point is the credit limit - I don't travel in such circles, but I can't imagine an 80 or 90year old having sufficient income to justify a credit limit nudging $40,000. That sounds a little negligent on the corporate side too unless the woman is independently wealthy with significant assets in the bank.

You're beginning to make me feel some sympathy for the 95 yr old.

 

[CanadaJohn]

Those who have paid and are willing to continue paying that 1% should be grandfathered in.

Unless there's contract language to that effect, I disagree. I'll bet in the cardholder agreement, there's language to allow the withdrawal of the program at any time. If you were talking about them picking on only some customers, like weeding the old ones off the program, I'd agree with you - but if all are being removed, that's fair in my books because this isn't a life insurance policy, it's designed to help those who die suddenly or lose employment suddenly, that kind of thing.

 

[FederalRepublic]

Well, you're right about insuring their loss -- UNLESS you have that kind of money. Your estate must pay all bills after your death.

I must admit, though, one could have $2 million in assets and very easily structure them so there was no money available to pay any debt at all. Maybe her family should get busy with Plan B. :rofl

So just buy a regular life insurance policy that will pay the beneficiary of your choice when you die...who chooses their credit card company as their beneficiary?

 

[MaggieD]

So just buy a regular life insurance policy that will pay the beneficiary of your choice when you die...who chooses their credit card company as their beneficiary?

It's not unlike mortgage insurance. That's been around forever. (In that case, it's a decreasing term policy payable to the mortgage holder in the amount of one's outstanding balance.)