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All About Credit Card Purchase Protection

Your daughter has, once again, destroyed her backpack (and she blames the dog). Maybe you order something from a website and the item never comes, but the seller refuses to acknowledge you. Or your favorite pair of sunglasses gets stolen right out of your pocket while you’re waiting in line for your morning coffee. Most people assume they’re just going to have to suck it up and deal with it, but this is not always the case – especially if you used a credit card with purchase protection.

Purchase protection isn’t as well-known as it should be, especially since the benefits can save you time, money, and stress. Not only does purchase protection on a credit card give you some peace of mind, it also means that you might not have to replace that pair of $200 sunglasses after all. If you’re curious on how this could help you, keep reading to learn all about credit card purchase protection.

Why Purchase Protection is a Good Thing

Basically, purchase protection is exactly what it sounds like, which can be rare in the credit card world. If an item turns out to be defective, you can dispute the legitimacy of the charge. That is, if you paid for something and it turned out to be a dud, you can claim the company that sold it to you didn’t come through on their promise and you deserve your investment back.

Another type of purchase protection allows a consumer to claim a refund when an item is stolen, ruined, or lost. Purchase protection is not usually an add-on, like a credit protection plan, which costs extra on a yearly or monthly basis. Purchase protection isn’t found on every card from every bank, but it’s often an automatic thing on a card that is considered higher-end or for those with good credit. A couple of examples:

  • Any American Express Card
  • Visa Signature
  • World Elite MasterCard
  • Barclaycard Arrival PlusTM World Elite MasterCard®
  • Some Discover cards, if items are stolen or damaged

Some of these cards will even refund a price purchase difference. So if an item suddenly goes on sale and the store won’t honor the new price, you can appeal to your credit card company instead. The benefits are different on every card and with each and every company, so clarify the actual rules before you choose which card you’d like to use for a big purchase.

How Purchase Protection Can Be Tricky

Like any company, your credit card holder has every right to simply deny your claim if they don’t agree with the details. Every case is handled on a case-by-case basis, so just because your best friend got her cell phone replaced doesn’t mean you’ll get the same benefit.

All purchase protection plans are different, but most card issuers have many exclusions from their policies. The most common ones are:

  • Animals
  • Consumable items (so if you went to lunch and you didn’t like it, you can’t ask for the money back from your credit card issuer)
  • Concert tickets
  • Cruise tickets
  • Cars
  • Boats
  • Other vehicles, such as motorcycles

So if find your Les Miserables tickets have disappeared, or your cat comes down with a nasty cold – these kinds of things are not likely to be covered by your credit card company.

In addition to purchase restrictions, sometimes a company will not cover an item if it’s been lost or stolen in a particular way. Most issuers exclude things that are stolen from vehicles, left in a public place, or things that disappear when you don’t have an eye on them, such as your iPad from a piece of luggage (even if it’s a checked bag). Many issuers also don’t cover things that are lost due to things like earthquakes or radioactive contamination. Normal wear and tear also doesn’t count as a loss, and generally speaking, claims will be denied in the case of a couple of dings and bangs that cracked your iPod screen.

What You Need to Know Before You Suddenly Need Your Protection

If your credit card issuer offers card protection, keep these following points in mind when you’re researching just what it can do for you:

  • Coverage Amount: Depending on your card, your coverage amount is completely different. Usually the least a company will cover is around $500, but it can be as high as $10,000. Read the fine print.
  • Document your losses immediately: To avoid fraud, most companies will ask for some sort of proof that your item is either ruined or no longer with you. This can be something as simple as a picture of a broken item or a copy of the police report stating that the item has been stolen.
  • Make your claim quickly: Don’t wait! As soon as you have a problem, file a claim and documentation so that you can jump through any hoops your company requires.

Bottom Line: Credit card purchase protection can be a very valuable asset as long as you know what’s covered and what’s not, so start reading your contract to today to see if you’re covered.