Your Credit Card Can Keep You From Getting Ripped Off. Here’s How

When most people think of the value that credit cards offer, they first think of its power as a method of payment, and the ability to earn rewards. But some of the most valuable features of your credit card are its purchase protection policies. These policies can protect you, for instance, when your shiny new phone gets stolen, that camera you bought online arrives broken or your computer breaks just outside its warranty. Unfortunately, most cardholders are only vaguely aware of the their card’s purchase protection policies, and how to best use them.

Here are six ways that you can get the most value from your card’s purchase protection benefits.

1. Obtain a Copy of Your Card’s Guide to Benefits 

Every card issuer offers customers a document called the guide to benefits that details all of the purchase protection programs your card offers. It will include the types of purchase protection, the terms and conditions of each, and how to submit a claim. You would have received a copy of this document in the mail with your credit card after you opened your account, but few people actually save it. Instead, you can search for an electronic version online or contact your card issuer to request a new one by mail.

2. Save Your Receipts 

There are several kinds of purchase protection benefits that may be offered by your credit card including damage and theft protection, price protection, extended warranty coverage and return guarantees. But what all of these policies have in common is the need to provide your original purchase receipt when submitting a claim. To keep track of your  receipts, you could place them all in a file, or you could put them in an envelope that you keep attached the purchase itself. Another reliable strategy is to take a picture of the receipt with your smartphone, as long as its memory is backed up online.

3. Chose a Credit Card Based on Its Purchase Protection Policies

When selecting a new credit card, take a moment to consider its benefits, including purchase protection. While many cards come with a policy that compensates you for theft or damage, some credit cards come with additional policies, like extended warranty coverage, a return guarantee and/or price protection.

And if you have several credit cards, you might want to choose a card to make a purchase based on its protections. For example, if you’re purchasing an expensive electronic item, you might want to choose a card that offers the longest extended warranty option.

Remember, the better your credit, the more likely you’ll qualify for credit cards with these types of protections. It’s a good idea to check your credit before you apply for a card. (You can check out two of your credit scores, updated every 14 days, on

4. Look for Unusual Benefits

While many credit cards offer similar purchase protection policies, there are some cards that feature unusual exceptions that can be valuable. For example, eligible Wells Fargo’s credit cards come with a mobile phone protection policy that can reimburse you for up to $600 if your phone is stolen or damaged, so long as you pay for your cell phone bill with the card. Also, the Citi Prestige comes with Missed Event Ticket Protection that can cover the cost of your ticket to a sporting event or concert if an unexpected delay causes you to miss it. (Full Disclosure: Citibank advertises on, but that results in no preferential editorial treatment.)

5. Closely Follow the Terms of the Policy

Purchase protection policies will require you to take several steps in order to submit a valid claim. For example, if an item is stolen, you will have to make a police report within a specified time, typically 48 hours. If purchase is damaged, then you might have to obtain repair estimates as part of the claims process. Finally, you will always have to fill out a claims form within a designated time period, typically within 30-90 days of a loss.

6. Rely on Your Credit Card’s Extended Warranty Coverage Instead of Optional Plans

When you make a major purchase from a retailer, it will often offer you an optional extended warranty at an additional price. But if you are aware of your credit card’s policy, then you may be able to enjoy much of the same coverage at no additional cost.


Image: macniak

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