I moved from O2 to three recently on a sim only deal (bought iPhone 4S handset sim free) and pay £10 per month for more than I was getting on O2 for £21 pm (similar minutes but more data)
Regarding insurance; £12 is a rip off. As people have said most banks do benefit packages, for £6 a month from Barclays I get phone and gadget insurance and some things I don't use like an interest free overdraft up to a certain amount.
Its £6.50

hehe
Its a good deal though, it nets you:
Mobile phone insurance
- Like for Like replacement, or 'original cost' if like for like is not available (example: Our 3gs 16gb broke thanks to children and a toilet.. lol, at this time only 8gb 3gs's were available .. bank gave us the cash for a brand new 16gb iPhone 4

- SIM protection, covers you for up to, i think, £5000 spent on your SIM without your knowledge.
- Covers loss, theft, accidental damage world wide
- 'dumb' phones have no excess, Smart Phones with value under £100 have no excess, over £100 in value have between £10 and £50 excess (iPhone

but £50 is a lot better then £500)
- One negative .. only 2 claims per 12 months, but if your not exploiting the system its more then enough.
Also
Gadget Insurance
- £25 excess for first claim in 12 month period, £50 for second or more
- Available for goods up to a combined value of £500 (so in our case its an iPad insurance

)
- Covers loss, theft, accidental damage world wide
That covers the stuff people here are likely to be interested in, and the main reason I have this account with Barclays.
Other useful features are up to 3 years extended warranty cover on domestic appliances and ID theft/Card holder protection.