How Does Credit Card Purchase Protection Work?

Ever bought something, only for it to break or get stolen soon after? Enter credit card purchase protection, your unsung hero when shopping. This nifty perk can help save you from the heartbreak of a damaged or lost item. Let’s break down how credit card purchase protection typically works and why it’s necessary for savvy shoppers like you.

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MoneyLion can help you explore a wide variety of credit card options tailored to different needs and preferences. Whether you’re after low interest rates, fantastic rewards, or robust purchase protection, we’ve got the perfect card for you.

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Understanding how credit card purchase protection works

Credit card purchase protection is a benefit offered by many credit cards that provides coverage for new purchases against damage or theft for a certain period after the purchase. Typically, this period ranges from 90 to 120 days.

It’s like having a safety net for your most treasured buys, ensuring that you get the most out of your money even when things go wrong.

Purchase protection vs. extended warranty coverage vs. price protection

It’s easy to confuse purchase protection with other card benefits like extended warranty coverage and price protection. Still, each serves a unique purpose:

• Purchase protection: Covers new items against damage or theft within a specific period after purchase. Think of it as a temporary insurance policy for your recent buys.
• Extended warranty coverage: Extends the manufacturer’s warranty on eligible products, often adding a year to the standard warranty period.
• Price protection: Refunds the difference if you find a lower price for an item you purchased with your credit card within a specified period.

What is covered by purchase protection?

The type of credit card purchase protection you receive will ultimately depend on the type of card you have and the issuer’s individual policies. That said, purchase protection typically centers around the following:

• Theft: If your item is stolen within the protection period, you can file a claim to get reimbursed for the loss.
• Damage: Accidental damage to your item, such as drops or spills, is usually covered.
• Loss: Some cards also cover lost items, though this can vary by issuer.

What is not covered?

While purchase protection is great, it doesn’t always cover everything. Common exclusions may include:

• Perishables: Food, drinks, and other consumables.
• Used items: Pre-owned or refurbished products often aren’t covered.
• Motor vehicles: Cars, motorcycles, boats, and similar items typically aren’t eligible.
• Intentional damage: Damage caused intentionally by the cardholder is not covered.
• Items bought for resale: Products intended for resale are usually excluded.

Comparing networks’ purchase protection

When it comes to purchase protection, different card networks offer varying levels of coverage. Here’s an overview of how Mastercard, American Express, and Visa stack up:

	Mastercard	American Express	Visa
What’s covered	Theft, damage	Theft, damage, and sometimes loss	Theft, damage
What’s not covered	Perishables, used items, motor vehicles	Perishables, used items, motor vehicles, cash	Perishables, used items, motor vehicles
Duration	Typically 90 days	Up to 120 days	Typically 90 days
Coverage	Up to $1,000 per claim, $50,000 per account	Up to $1,000 per occurrence, $50,000 per calendar year	Up to $500 per claim, $50,000 per account
Cards covered	Varies by issuer	Most Amex cards	Varies by issuer

Be sure to read through the terms to better understand and compare benefits before you commit. 

How to file a purchase protection claim

Filing a purchase protection claim looks different depending on your credit card issuer, as different companies can have various policies and procedures. Generally, you can expect the process to look this way: 

1. Notify your card issuer: Report the incident to your card issuer as soon as possible, usually within 30 days of the event.
2. Submit documentation: Provide necessary documents, such as receipts, proof of purchase, and police reports (for theft).
3. Fill out the claim form: Complete the form provided by your issuer.
4. Wait for review: Your claim will be reviewed, and you’ll be notified of the decision.
5. Receive reimbursement: If approved, you’ll receive reimbursement for the covered amount.

Best credit card companies for purchase protection

Here’s a quick comparison of some of some of the best credit cards offering purchase protection:

Credit card company	Purchase protection coverage	Annual fee	Welcome bonus
Chase Sapphire Preferred®	Covers new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account	$95	New cardholders can earn 60,000 bonus points after spending $4,000 in the first three months.
American Express Platinum	Up to $1,000 per occurrence, $50,000 per year	$695	Earn 80,000 Membership Rewards® Points after you spend $8,000 in eligible purchases in the first six months.
Citi Strata Premier® Card	Up to $500 per claim, $50,000 per year	$95	Earn 75,000 bonus points after spending $4,000 in the first three months, redeemable for $750 in rewards.
Capital One Venture Rewards	$0 fraud liability	$95	Enjoy $250 to use on Capital One Travel in your first cardholder year, plus earn 75,000 bonus miles once you spend $4,000 on purchases within the first three months from account opening.
Discover it® Cash Back	You’re never responsible for unauthorized purchases on your Discover Card	$0	Get an unlimited dollar-for-dollar match of all the cash back you earn at the end of your first year.

Protect your purchases

Credit card purchase protection is a valuable perk that can save you from unexpected costs and headaches. By understanding how it works and knowing what’s covered, you can make smart purchasing decisions and feel secure knowing your investments are protected. Whether buying a new gadget or a fancy piece of furniture, having a card with robust purchase protection ensures you’re always covered.

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