i have a question about the credit protection on my credit card?

Question

when i first got my credit card about 7 yrs ago i opted to take the credit protection that they all offer..you know the one where they charge like .07 per $100 (in case i ever lose my job or am unable to work)...well i cancelled my credit card(finacial reasons)..and i want to cancel the protection too. My question is if i cancel it will i lose whatever i have paid into it over the years or do u think that they would put whatever i have paid towards my balance?

Answer 1

I'm answering this question only because of Q and A's answer.

First of all, you were paying for a service. You pay the money, they provide the service. You weren't building any balance with the money you put toward the protection, you were paying for the protection. That protection service had a cost, and what you paid into it, covered the cost.

Now with respect to the nonsense that was in that other answer, there is something called a debt to equity ratio that is involved in figuring your credit score. In more simple terms, they look at how much outstanding debt you have versus how much you make.

Believe it or not, your credit limit on that card is considered debt on the part of credit companies. You may have had a limit of $10,000.00 on that card, and even though you never hit that amount with that card, potentially you could have. Therefore with that card, you had an additional $10,000 in debt.

And by getting rid of that card, you reduced your debt by whatever your limit was, thus making your credit rating that much more favorable.

Good job!

Answer 2

I think that the money you paid is basically a fee for their service, in which case you would not get any money back. You might want to reconsider cancelling your credit card. I'm not sure of your reasons for doing so but your credit score can be hurt by cancelling an account since they base part of your score on how much credit is avaiable to you. You may be better off just cutting up the card and not use it but keep the account open.

Answer 3

You lose the money you paid.

It's like health insurance. If you pay $2000/year for it, but only use $500 worth of medical services, the other $1500 is just gone.

Call to cancel and get the address for the company and send the cancellation in writing, by certified mail. When you talk to the operator, tell him or her that you want verification that it was cancelled in writing. (I asked for this and it made it a lot easy to dispute when they put it back on two months later.)

Answer 4

You've lost it ... it's essentially like an insurance policy ... and unless you're SURE you're going to lose your job in the near future (like you were told layoffs are coming and you're on the bottom of the seniority list) it's also a very bad investment ... you pay a ton of money for a very minimal amount of protection. You'd be better off putting that money toward the balance right away and get the debt paid off ... then it isn't an issue.

Good Luck.

Answer 5

maximum companies ought to settle for this and clean the debt out of compassionate motives, yet i'm unsure on the regulation - noticeably while you're US it relatively is going to be distinctive. i might say that mastercard coverage is oftentimes a rip off as you generally in basic terms have the enjoying cards for a quick era in the event that they are on an low interest furnish or merely to pay some thing off etc. If stay interior the united kingdom i might reccommend customer Direct - the government helpline - the all and sundry is relatively effective. different than that then your nearest customer helpline or figuring out to purchase and merchandising standards kind of place of work will help.

Answer 6

When you canceled the card, you canceled the credit insurance with it. You didn't 'pay in' over the years. Insurance is not a savings account. The premiums were gone the moment they were charged. BTW, if anyone sells you insurance that pays THEM, you are getting an extremely bad deal.