Chase bank has announced that it will end its Payment Protector plan in May. The option allowed credit card holders to insure themselves against job loss, illness, or disability -- with payments deferred for up to two years -- for an extra monthly fee that was usually less than 1 percent of the card balance. The Payment Protector plan also covered up to $25,000 in credit card debt per account left behind after a customer died.
Chase says that it is acting within its rights to change the terms of the deal at any time. However, termination of the product has left many customers concerned, such as 95-year-old Dorothy Cross, who has a balance of more than $38,000 on three Chase cards and has paid Payment Protector fees for about a decade to keep her debt from overwhelming her family after her death. Cross' son, Emory, says the bank's conditions were buried in the contract and also make the agreement essentially worthless by requiring customers to make payments for coverage, when the bank has no obligation to fulfill its responsibilities. Chase is not the only bank that is stepping away from payment protection; Bank of America, American Express, and Capital One also say they will drop their plans. Consumer advocates say cardholders should pay down their balances rather than pay fees for account add-ons like payment protection, as the services are rarely worth the money.