Credit card purchase protection isn’t as glamorous as free travel or bonus points, but it can save you hundreds of dollars when things go wrong

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• Many credit cards offer purchase protection for free as a cardholder perk. This coverage can reimburse you for all or part of the purchase price if an item is damaged or stolen within a specific length of time, usually up to 120 days.

• As you compare rewards credit cards and their benefits, make sure you understand which cards offer a higher level of this type of coverage.
• For example, while the no-annual-fee Chase Freedom offers purchase protection good for up to $500 per incident, the premium Platinum Card® from American Express offers $10,000 of the purchase price of an item.

• Other cardholder perks to look out for include extended warranties and price protection. 

• Read more personal finance coverage.

Rewards credit cards offer plenty of exciting perks, from airport lounge access to bonus points on your top spending categories to annual statement credits for travel. Some of these cards also offer benefits that, while not as glamorous, can help you save money or get a refund for certain products.

Purchase protection is one such credit card feature that protects consumers when they buy eligible products with their card. This coverage allows you to receive reimbursement if a product is stolen or damaged in most cases, although the amount of coverage can vary. Coverage can easily be worth up to $1,000 per item, although annual caps of up to $50,000 can also apply.

Keep in mind that we’re focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It’s important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back. 

How credit card purchase protection works

Let’s say that, for example, you buy a laptop computer for $900 and pay with a credit card that offers purchase protection. If your laptop is stolen from your car or damaged during your credit cards’ purchase protection coverage window, you could be reimbursed — with the amount depending on the specific of your card’s coverage.

Most credit cards that offer purchase protection offer coverage for 90 to 120 days after you make a purchase, and the coverage amount may vary depending on the state you live in. 

The best credit cards for purchase protection in 2019

• Platinum Card from American Express ($550 annual fee)
• Chase Freedom (no annual fee)
• Chase Sapphire Reserve ($450 annual fee)
• Ink Business Cash Credit Card (no annual fee)
• Blue Cash Everyday® Card from American Express (no annual fee)
• United Explorer Card ($95 annual fee; waived the first year)

As you explore credit cards that offer purchase protection, keep in mind that many offer other perks like cash back or travel rewards, travel credits, airport lounge access, and more.

Here are some of the absolute best credit cards for purchase protection available in 2019, 2020, and beyond:

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How purchase protection works among payment networks

The credit cards above offer some of the most valuable purchase protection coverage available today, but keep in mind that different credit card networks set standards for their coverage that most of the credit cards adhere to. In other words, Visa sets rules for Visa credit cards that offer purchase protection, while Mastercard and American Express also set their own. 

The following chart outlines the rules most cards from each credit card network tend to follow:

Alyssa Powell/Business Insider

Other cardholder protections to look out for

As you search for credit cards that offer purchase protection, don’t forget about the similar benefits some credit cards offer. You may want to look for credit cards that also offer extended warranties or price protection, for example.

Extended warranties

With credit card extended warranties, you can qualify for an additional year or longer of warranty protection after the manufacturer warranty on eligible items runs out.

Let’s say you purchase a refrigerator that comes with a two-year warranty, for example. If your refrigerator stopped working a month after the manufacturer’s warranty ends, a credit card that offered an additional year of extended warranty coverage might pay for the required costs involved in repairing or replacing your refrigerator.

Some of the best credit cards that offer extended warranties include:

• American Express® Gold Card

• Chase Sapphire Reserve

• Chase Freedom Unlimited

• Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard
®

Price protection

Credit card price protection works differently, but it can be just as useful. With price protection, you can typically be reimbursed for the difference if you pay for an item and the price goes down within a specific length of time, usually up to 120 days. 

This type of coverage can be beneficial if you want to purchase a big ticket item but worry the price may go down in the future for any reason, including a pending sale. 

Some of the best credit cards that offer price protection coverage include:

• United MileagePlus Club Card

• Wells Fargo Visa Signature Credit Card

• Capital One Walmart Rewards Mastercard


The bottom line

Since credit cards offer lucrative rewards schemes that let you score cash back, free travel, and more, it can be easy to overlook all the other benefits they offer.

However, purchase protection and similar benefits can pay off in a big way over time if you wind up having to use them. And since they’re offered free as a cardholder benefit, it can make sense to pick up a card that offers as many perks as you can get. 

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