Have you ever bought something new, only to accidentally damage it shortly thereafter? Of course you have, it happens to the best of us!
If your new purchase is accidentally damaged, stolen, or lost, you would be out of luck if you paid for it using cash or a debit card. However with credit card purchase protection, your eligible purchase would have been covered!
How does the purchase protection insurance work?
Not all cards have it… the ones that do are often mid-tier to upper-tier credit cards like American Express, Visa Signature, etc. Purchase protection credit card coverage varies by issuer.
Consult your card issuer to see if you have coverage and how it works, but it typically is something along these lines if it comes on your card…
- If your eligible purchase is accidentally damaged within 90 days or purchase, the credit card company will pay to repair the damage, replace the item altogether, or reimburse you for the cost of the item (the best option depends on the circumstances of course). Please note that Visa’s program has the most restrictions when it comes to accidental damage, as they only cover “damage due to fire, vandalism, accidentally discharged water, or certain weather conditions.”
- If your eligible purchase is stolen (or lost, which is a part of some credit card protection plans) within 90 days or purchase, the issuer will reimburse you for the amount.
Are their limits on coverage?
Naturally, there has to be limits in place. Please note the limits vary by each individual card and what’s mentioned below can change at any time (so please check and confirm with issuer) but here’s a summary of what they were at the time of writing:
- With American Express, the purchase protection limits vary by card. On most AmEx cards the coverage is up to $1,000 per occurrence, with a maximum of $10,000 per year in benefits. The Platinum charge card and Delta Reserve offer higher coverage at $10,000 per occurrence with up to $50,000 in annual claims, however those two cards both carry a $450 annual fee.
- With Visa Signature cards the limit is up to $500 per claim and $50,000 per cardholder.
- With MasterCard, some Platinum and World versions include “Purchase Assurance” coverage. The limit is $1,000 per occurrence, $25,000 max per year. Meanwhile some other MasterCards which offer “Buyers Security” that gives $500 coverage per occurrence and $50,000 per cardmember, per year.
Does this benefit cost extra?
The best part is this benefit is included for no additional costs on most cards that offer it.
What are the best credit cards with purchase protection?
Here are CreditCardForum’s sponsored picks for 2013:
American Express Blue – This is one of their most popular cards. The rewards and benefits are extraordinary.
Chase Sapphire – This credit card also offers an immense array of benefits including purchase protection.
This article was last updated November 15, 2013