Your cards have gone. Who do you ring first?

Peace of mind for under £30 a year – or a costly add-on you can easily do without? Esther Shaw considers the case for cover against the loss or theft of your wallet or purse

There is nothing quite like the shock you receive when you realise that your wallet or purse – and all the cards contained in it – has been lost or stolen.

And as if that were not bad enough, worrying new figures from the Association for Payment Clearing Services (Apacs) show that fraud on debit and credit cards soared by 25 per cent last year, with losses reaching a record high of £535.2m.

This is where card protection policies are supposed to kick in. You will often find them advertised in the leaflets sent out along with new credit or debit cards, pledging "life assistance" or "emergency support" if your cards are lost or stolen. But while these claims all sound pretty persuasive, is the cover really all it's cracked up to be?

The biggest selling point of card protection – apart from removing any personal liability for losses due to fraudulent transactions in the event of theft – is that if you have it and the worst happens, you need only make one phone call to report the loss of all your cards.

"Card protection cover is offered as an option by virtually all credit card providers, and costs between £18 and £29 a year," says David Black from financial researcher Defaqto.

"This type of insurance is essentially 'peace of mind' cover if your cards are lost or stolen. All you have to do is make one phone call, and then a case worker will deal with all your card providers," adds Mr Black.

In addition, some card protection policies may offer cover for the cards of the people who live with you, as well as protecting you against any losses incurred through fraudulent spending, loss of passport, travel tickets, keys or luggage. The main providers in the UK are Card Protection Plan and Sentinel.

In many cases, this type of cover is offered by banks as one of a selection of incentives, along with travel insurance, breakdown cover and mobile phone insurance, to get you to take out a packaged current account – for a monthly fee.

Lloyds TSB, for example, offers Sentinel Card Protection worth £20 a year if you open one of its Select, Gold Service, Platinum or Premier accounts; fees for these range from £7 a month for Select to up to £25 a month for Premier

"Card protection does have its place in the market," says Tracy North from price-comparison service uSwitch. "But you are having to fork out more than £2 a month for this cover."

Adam Williams from the consumer body Which? adds that it may be useful if you have a lot of cards, but if you have only one or two, you could simply call those individual providers yourself.

In fact, card protection can be something of a money-spinner for all concerned. Mr Black points out that the banks earn commission from the providers if you buy the cover.

David Kuo from the financial information website argues that card protection cover is an "expensive add-on that consumers can well do without". He notes: "The law already limits card customers to a maximum [liability] of £50 if they are victims of fraud."

The only exception to this is if it can be shown that you have not taken "reasonable care" with your cards.

"Card protection should be renamed 'money for old rope' because that is what you are paying for if you take it out," says Mr Kuo.

That said, those providers that do offer the cover are insistent that it represents good value for customers.

Nationwide building society's policy costs from £29 per year and is underwritten by Card Protection Plan. The Nationwide's spokeswoman, Jackie Lawrence, says: "It is an option for customers who want the security of knowing that if their wallet, purse or handbag gets lost or stolen, their cards, house keys, car keys, driving licence, passport and mobile phone are all protected."

FootballGerman sparks three goals in four minutes at favourite No 10 role
Rumer was diagnosed with bipolarity, attention deficit hyperactivity disorder and post-traumatic stress disorder: 'I was convinced it was a misdiagnosis'
peopleHer debut album caused her post-traumatic stress - how will she cope as she releases her third record?
A long jumper competes in the 80-to-84-year-old age division at the 2007 World Masters Championships
Have you tried new the Independent Digital Edition apps?
Radamel Falcao was forced to withdraw from the World Cup after undergoing surgery
premier leagueExclusive: Reds have agreement with Monaco
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
Life and Style
Walking tall: unlike some, Donatella Versace showed a strong and vibrant collection
fashionAlexander Fury on the staid Italian clothing industry
Arts and Entertainment
Gregory Porter learnt about his father’s voice at his funeral
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
Life and Style
Children at the Leytonstone branch of the Homeless Children's Aid and Adoption Society tuck into their harvest festival gifts, in October 1936
food + drinkThe harvest festival is back, but forget cans of tuna and packets of instant mash
New Articles
i100... she's just started school
New Articles
Life and Style
Couples have been having sex less in 2014, according to a new survey
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
New Articles
i100... despite rising prices
Holly's review of Peterborough's Pizza Express quickly went viral on social media
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Senior BA - Motor and Home Insurance

    £400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

    Market Risk & Control Manager

    Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

    SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

    £320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

    Head of Audit

    To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

    Day In a Page

    Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

    Despite the result, this is the end of the status quo

    Boyd Tonkin on the fall-out from the Scottish referendum
    Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

    Manolo Blahnik: Flats, Englishness, and Mary Beard

    The shoe designer who has been dubbed 'the patron saint of the stiletto'
    The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

    Scrambled eggs and LSD

    Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
    'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

    'Normcore': Blending in is the new standing out

    Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
    Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

    New leading ladies of dance fight back

    How female vocalists are now writing their own hits
    Mystery of the Ground Zero wedding photo

    A shot in the dark

    Mystery of the wedding photo from Ground Zero
    His life, the universe and everything

    His life, the universe and everything

    New biography sheds light on comic genius of Douglas Adams
    Save us from small screen superheroes

    Save us from small screen superheroes

    Shows like Agents of S.H.I.E.L.D are little more than marketing tools
    Reach for the skies

    Reach for the skies

    From pools to football pitches, rooftop living is looking up
    These are the 12 best hotel spas in the UK

    12 best hotel spas in the UK

    Some hotels go all out on facilities; others stand out for the sheer quality of treatments
    These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

    Widespread fear of Isis is producing strange bedfellows

    Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
    Topshop goes part Athena poster, part last spring Prada

    Topshop goes part Athena poster, part last spring Prada

    Shoppers don't come to Topshop for the unique
    How to make a Lego masterpiece

    How to make a Lego masterpiece

    Toy breaks out of the nursery and heads for the gallery
    Meet the ‘Endies’ – city dwellers who are too poor to have fun

    Meet the ‘Endies’ – city dwellers who are too poor to have fun

    Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
    Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

    Ian Paisley’s decision to make peace with his IRA enemies

    His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam