This current account is supposed to make you better off by £280 a year. But one Fool wouldn't touch it with a bargepole.
Yorkshire Bank aimed to take on the big boys this week when it launched a new packaged current account aimed at professionals.
The Signature Current Account costs £10 a month and boasts benefits the bank claims are `worth nearly £400 a year' - leaving you £280 better off. But is it all it's cracked up to be?
What you get
Basically packaged accounts work like normal accounts in that you have a bankcard and overdraft, but for a monthly fee you can also get a range of perks such as travel insurance, car breakdown cover and discounts on the bank's other products.
It's open to debate about whether packaged accounts are worth the money - as my fellow Fool Szu Ping Chan explains in The Classic Current Account Con.
But the good news is, at £10 a month, the Signature account is cheaper than most of the accounts mentioned in Szu's article. For that you get annual worldwide travel insurance, mobile phone and gadget cover, car breakdown cover and ID theft insurance.
The account also offers a `sweeping' facility whereby surplus credit in your account is moved into a linked Signature savings account which pays 5.3% until September 2009.
Is it any good?
The travel insurance covers you and your family (up to two adults and four dependent children) for worldwide travel except to Afghanistan, Cuba, Liberia and Sudan. Afghanistan is obviously not a top holiday destination and the Foreign and Commonwealth Office also warns against travel to Sudan and Liberia. But Cuba? I quite fancy it and can see no reason not to go.
The travel insurance also includes 17 days' winter sports cover. Yorkshire Bank boasts the policy is worth £180 but similar policies can be found online for about £60 (and they cover Cuba too), and if you're single without kids, you can find even cheaper travel insurance online. In conclusion, the policy isn't bad. but I think it's not worth as much as the bank claims.
Account-holders also get Green Flag Rescue Plus breakdown cover `worth £46'. This covers your car if you break down on the road or at home. The main downside to the policy is that in the event of a breakdown it will only take your vehicle to a repairer within 10 miles of the incident.
I had a policy that stipulated this once and found out the hard way how inconvenient it can be. My car conked out half way down the A2 on Christmas Day and my breakdown cover would only take me to a nearby garage (which was shut for the festive season, obviously) as opposed to towing the car to a garage near to where I live or towing me back home. A more comprehensive policy such as the AA will tow you where you want and also covers the member rather than the car.
So, to sum up, I'd be very wary of a breakdown policy that won't tow you very far in the event of a breakdown - you could end up stranded the other end of the country for days while your car is being fixed.
Signature customers also get mobile phone and gadget insurance `worth £95 a year'. I have my doubts about whether this kind of insurance is ever worth the money as most phones and gadgets can be covered on your home insurance and specialised policies tend to be riddled with exclusions.
Finally, the account offers identity theft insurance `worth around £70'. But this is another type of insurance that's rarely worth anything at all. Unless you have been negligent with your personal information, any money lost through ID theft is normally refunded.
Interest rates
While you account is in credit you'll receive 2.5% gross on your balance. While higher than some current accounts that pay a stingy 0.1% in-credit interest, the rate doesn't compete with the best paying current accounts such as the Alliance & Leicester Premier Direct Account which pays 8.5% or Abbey which pays 8% as explained by Szu Ping Chan in Earn 60 Times More Current Account Interest.
The Signature Current Account also comes linked to a Signature Savings Account which currently pays 5.3%, although this includes a bonus of 0.75% until September 2009 - so expect the rate to fall then. Even with the bonus, it's not a table-topping savings account compared to what's available elsewhere and online. At the moment, for example, Kaupthing Edge pays 6.55% and Heritable Bank pays 6.51%.
Thumbs up or thumbs down?
Thumbs down I'm afraid. The packaged products are pretty mediocre and the linked savings account rate is easily beaten. So don't be lured in by gimmicks. Shop around and find the best current account for your needs using the the Fool's whole-of-market current account comparison tool.
More: Earn 60 Times More Current Account Interest | The Classic Current Account Con