Major Banks Cut Credit Card Travel Insurance Ahead of Payment Reforms

Major banks in Australia have begun to reduce or remove complimentary credit card travel insurance for their customers, just as payment reforms are set to take effect on October 1.

The Reserve Bank of Australia (RBA) is implementing broader card-payment reforms that will reduce the interchange cap on domestic-issued consumer credit card transactions acquired in Australia from 0.8% to 0.3%, resulting in an estimated $660 million annual reduction in issuer interchange revenue.

Comparetravelinsurance.com.au, a travel insurance comparison service, is warning Australians to review their credit card travel insurance before their next overseas trip, as the changes affect holders of some credit cards issued by major banks including NAB, Westpac, ANZ, and Commonwealth Bank.

Natalie Smith, marketing director at Comparetravelinsurance.com.au, said travellers should not assume their existing cover remains unchanged. 'For many travellers, complimentary travel insurance is a highly appealing credit card benefit, but that cover can change over time.'