Friday, November 25, 2011

Beware Credit Protector Rip Off Credit Card Insurance, Please leave comments here.

Hi, I would like to build a list of credit-protector rip off stories. Please feel free to use the comments section below to explain what happened to you. 

It's possible your credit-protector or balance protector story could be one of those selected for a book I may write at a later date, if you are interested. 

Besides leaving your credit-protector rip off story here, you can also then contact me via my "about me profile" email address so that we can keep in touch, if you want to, no obligation required.

Tuesday, November 22, 2011

Credit Protector, Balance Protector, Payment Protector, Credit Shield, Account Balance Protection, and many many more aliases for an apparently corrupt credit card insurance plan.

The two overlapping images below list over 20 different names for  Consumer Credit Card Protection Insurance that is not overseen by any insurance agency or commission.  
The bottom line is, the ratio of premiums to policy holder claims actually paid out by unregulated insurance policies can be as low as 1%, meaning for every 100 dollars collected, only one dollar gets paid back to policy holders. 
While specific sections of credit card insurance coverage payout ratios may be as low as 1%, the overall average is higher, but well below insurance policies that ARE regulated by insurance regulators.

As a general rule, Credit Protector credit card insurance and it's gang of aliases won't ever reach the ratio of premiums to payouts that true insurance companies beholden to insurance guidelines pay out to their policy holders. This is what is truly wrong with the various credit card insurance protection programs that are offered apparently all over the world.

I'm estimating that most of the versions of credit protector credit card insurance programs are charging anywhere from 3 times to 9 times more than what they should were they actually regulated by insurance companies. If these credit protection service programs were ever sued for charging too much money for the past 10 to 15 years, the settlement payout world wide in my opinion would probably be over 100 billion dollars....and rising. 


Monday, November 21, 2011

How Credit Protector Insurance is used by the Credit Card Companies to siphon wealth from the consumer.

Credit Card companies that sell credit protector insurance are periodically sued and agree to pay fines (although the credit card companies do not agree to any wrongdoing) by both consumers and state attorneys general.

One wonders what would motivate credit card companies to keep selling the credit protector insurance product that regularly results in fines and penalties that run into the tens of millions of dollars?

The answer is that although credit protector insurance is called "insurance", the credit card companies have somehow magically lobbied our politicians so that credit protector insurance is not regulated by any insurance commission, agency, or required to follow  insurance guidelines regarding the ratio of money taken in to what is paid out via claims.

Credit protector insurance, if they wanted to, could pay out as little as one percent of the total amount of money they charge per year for credit protector insurance to their customers. Credit Protector insurance reportedly grosses 5 BILLION dollars per year. 

If the monthly accruing finance charges are added in, this amount could jump anywhere from 5 billion a year to 5.5 to 6.5 billion dollars a year. Factor in that some people end up over their credit card limit because of a credit protector charge and they could see their ENTIRE credit card rate hiked to as high as 30%!

Additionally, the forgiveness of either the principle payment or the interest rate charge when a claim is made by a credit protector insurance policy holder is a form of barter, yet it could possibly be a way to camouflage income since the interest rate forgiveness can cancel out that months payment, yet the payment was made anyways! 

It appears to me that Credit Protector insurance is a 5 to 7.5 billion dollar a year insurance business that appears to be accountable to no one but the lawsuits filed by the public and the state attorneys general. 

Unfortunately, while Credit Protector insurance lawsuit settlements might help reign in some of the bad credit card behavior, the settlements appear to have not steered the insurance agencies into regulating credit protector insurance programs.

Lack of accountability to an insurance agency by the credit protector insurance programs might be one of those gotcha situations that justify the Occupy Movement since they ultimately result in the loss of billions of dollars a year in wealth for main street and the 99%.

Sunday, November 20, 2011

JP Morgan Chase Bank settles Kardonick Credit Protector suit for 20 million dollars.

What is interesting about the Kardonick vs JPMorgan credit protector settlement is that it apparently does not actually accuse Chase Bank's credit protector program of improper pricing structure. It appears that the settlement has more to do with deception, difficulty actually collecting on the policy, not being able to cancel the policy, being signed up without proper approval, and so on.

The lawsuit does not appear to actually address the amount of money that Chase Bank took in versus what they paid out. So while this is kind of amazing that there are so many other aspects of credit protector that are lawsuit worthy, there still may be much bigger lawsuits to file against the credit protector program.

Wednesday, November 16, 2011

Is Credit Protector Overcharging its customers 1 billion dollars per month?

In a prior article, I calculated that the Credit Protector program is costing its customers 8 billion dollars a year in overcharges.The criteria I used to determine what is fraudulent requires estimating what the various credit protection insurance policies charge, versus what they pay out to their policy holders. 

I am estimating that credit protector may be taking in anywhere from 5 times to 10 ten times and perhaps significantly more, versus what it pays out, hence, we could call this credit protector insurance fraud.

However, when all the credit protector related compounded interest and monthly finance charges on the resulting higher and higher revolving credit card debt are factored in, plus penalties and fines when credit protector monthly charges take customers' over their credit limit, the credit protector overcharges could double to 16 billion dollars every year!

American consumers may be being overcharged by 1.33 billion dollars per month, or 1 billion dollars per month, take your pick. Is anybody going to do something about this mess? Just another reason that the occupy movement exists, no?

You can learn more about credit protector overcharging at

Sunday, November 13, 2011

How much money have Credit Protector Insurance programs defrauded their U.S. customers out of over the past 15 years?

On my website Credit-Protector, I estimated that Credit Protector is overcharging it's customers by a factor of ten.  Meaning that for every dollar credit-protector charges in premiums, they really should be charging ten cents!

I'm going to now guess just how much money the Credit Protector program has defrauded from it's customers. By defrauding, I mean charging several times more in premiums than will be paid back out  in legitimate claims. 

Ethically speaking, established insurance companies might pay out anywhere from  70 to 90% of all the revenue that they take in.  If an insurance company can't pay back out 70 to 90% in policy coverage for legitimate insurance claims, then they are charging too much for their services and could possibly be sanctioned, fined, or have their license revoked by various insurance oversight committees.

Enter Credit Protector insurance. Perhaps because each credit card companies monopolize their own credit card customers with their credit protector insurance, they may not feel compelled to actually offer a pay out ratio that is 70 to 90% of what they charge.

If we assume that the credit card companies are only paying out 5 cents per every credit protector insurance premium that they take in, we would assume that somebody would have stopped this basically fraudulent practice, but nobody has.

Lets further assume that only 1% of credit card customers are on the credit card insurance program called credit protector. Lets further assume that the average credit card debt is 5,000 dollars per insured.
Their monthly credit protector bill would be around 40 dollars.  

But keep in mind that that money spent on credit protector is not going towards paying down the credit card debt, so the higher monthly principle actually accrues higher and higher interest  charges.  But to keep it simple, we'll use 40 dollars per month times 1% of all credit card customers.

Assuming there are 150 million potential credit card customers, that means that 1.5 million customers x 40 dollars equals 60 million dollars a month are being spent on credit protector premiums. Assuming the 5% pay out of all premiums collected, that would mean that 3 million dollars out of 60 million dollars collected was spent on insurance claims per month.  Based on 60 million dollars collect per month at 80%, 48 million should be spent every month in claims, not 3 million.

I am estimating that in the U.S. Credit Protector insurance programs are collecting 45 million dollars every month that they should not be collecting.  45 million X 12 months equals 540 million dollars a year.

540 million dollars a year x 15 year equals 8.1 billion dollars worth of fraud over the past 15 years just from Credit Protector insurance in the United States.  

If we begin to factor in the overcharging causing people to not be able to pay down their actual credit card bill faster, thus resulting in higher and higher interest charges each month, plus penalties if the insurance put the person over their credit limit, I think we could double this amount to 16.2 billion dollars in overcharges to the american people in regards to Credit Protector insurance coverage over the past 15 years, or about a billion dollars a year!

Friday, November 11, 2011

David Lazarus, consumer advocate for the Los Angeles Times and KTLA, exposes Credit-Protector.

Unfortunately, Mr. Lazarus did not mention that I created a Credit-Protector website in 2007 that outlined how massively fraudulent virtually every aspect of credit protector actually was and still is.

Simply googling "credit protector" (with quotes around both words) will reveal that the Credit-Protector website that I created in 2007 and occasionally updated through 2009 is number two on the very first page of google, just below the citibank link.

It appears that Mr. Lazarus could have done his research by simply checking on the credit-protector program on Citibank's site and therefore did not need to look elsewhere, but if he had just looked at the very next link, he could have seen just how horrible the credit-protector program actually has been for a very long time.

I'm very proud of the work I did on Credit Protector, it was a true consumer advocacy work that was unfunded from any external source. If anybody ever gets the courage to sue the credit card companies that offer the Credit-Protector program, the refund to all those who were ripped off could be into the billions of dollars.