MasterCard Purchase Assurance Coverage Is Inferior

Even for a rewards junkie like me, the cash back, points, and miles aren’t always the deciding factor in which credit card I use for a given purchase. You also have to take into account the other benefits and the likelihood of using them.

When I’m making an expensive purchase which I think has a higher than normal chance of being lost, stolen or accidentally damage, I prefer not using my credit cards that come with MasterCard Purchase Assurance. While it certainly is better than what Visa offers, it’s not on par with American Express and here’s why…

Reason #1: Burden of proof for stolen items

If you look at the claim form’s rules you will see this part:

Purchase Assurance rule for lost items

When you read this, it basically makes it sound like if you have an item stolen but there is no “evidence of a wrongful act” then the Purchase Assurance program will classify that as a lost item, which is something that’s not covered.
Hmm, if an item is stolen than isn’t the evidence (the stolen item) typically missing, too?! Unless someone busted down your door or smashed a window to steal it, it seems like producing “evidence of a wrongful act” would be difficult, don’t you think?

Contrast that to the American Express Purchase Protection. I called that department to ask if a burden of proof was necessary for their benefit, and they said other than a police report, no additional “evidence of a wrongful act” was necessary.

Reason #2: Those darn vermin!

For some peculiar reason, MasterCard sticks in the following exclusion:

  • Damage caused by vermin

When I hear that word I typically just think of rodents, but according to the dictionary definition it encompasses any number of “obnoxious and objectionable” creatures, insects and small animals (wonder if those nippy toy dogs are considered vermin, because they sure are obnoxious).

While in all honesty I think it’s unlikely that something you buy with a credit card will be damaged by these pests during the first 90 days, I can envision many circumstances where it could happen (i.e. bedbugs in the city, small animals ruining outdoor items).

Reason #3: Items lost/damaged in transit

For anyone that shops a lot online, this should be a major concern. When UPS, FedEx, or USPS leaves a package at your door and someone swipes it, it doesn’t appear MasterCard will be picking up the tab:

Purchase Assurance rule for shipping

And as you see above, even damage from shipping isn’t covered. This basically means the benefit is useless for shipping and if you don’t want to risk it, you will be forced to buy delivery insurance when you place your orders. For many this is probably the time they want this benefit the most!

But not all is bad…

Does the purchase assurance from MasterCard have its drawbacks? Absolutely. But at the same time, I should point out that I have heard from many people who shared positive reviews of using it. For example one guy had his computer go bad and after submitting a repair estimate (required by MasterCard) he received a check within two weeks for $800. So it’s still a great benefit to have, as long as you keep the exclusions in mind.

But ultimately, this same benefit (under a different name) through American Express is superior, in my opinion. I have used it myself and have had nothing but pleasant experiences with it. In fact, the last time I used it my Amex Blue credit card had a statement credit for the claim amount within just a matter of 5 or 6 days. Very fast turn around and thus far, I haven’t had to do any haggling to get them to pay up. Another advantage is that you can submit a claim form both online and over the phone.

What are your thoughts? Any experience with MasterCard benefit?

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The program’s not all that bad. Number one, remember it is a secondary insurance so you should not expect full coverage for every type of incident. I’ve used the purchase assurance three times over the years, and was successful with my claims all three times. I had some garden tools stolen from my backyard in a tool shed. I have a fenced in yard; the thieves pulled my gate open, which was locked, bending the lockstand, then pried the door open on my shed. These were evidenced by the police and noted on the report. They paid the full amount up to my insurance deductible for the claim. Quick turn around and very polite. Next two claims had to do with damaged items. On each of these claims, they paid. The only downfall was the fact they wanted estimates for repairs which are sometimes difficult (and not free) to get on one claim and on the second one, they wanted me to ship the damaged item back to them for salvage, again not free. But considering the alternatives (getting nothing) this plan is practical and does pay when the terms of the offering are met. They don’t try to cheat, they only enforce the rules as they are written.

Purchase assurance is IMO, worthless. The note, lost or damaged, within that 60 day period sound like broad coverage but apparently there is more to the exclusions than just ‘vermin’ …

Apparently kids, drinks and laptops … are also excluded. They denied a claim on a Dell Laptop that inadvertently was hit with a coffee spill citing an exclusion for damage from liquids of any kind.

You mention that some folks have had coverage provided. At this point I would like to believe they actually cover anything as there must be more exclusions than you mentioned (such as the ixnay on damages caused by liquids). I certainly wish I had put this purchase on my AMEX.