Summary of Credit Card Purchase Protection Benefits

cloud      2015-09-07     2017-09-15 3 Comments

Suppose you just bought an iPhone a week ago and its screen was broken, the Apple seller insisted that it was man-made damage without guarantee repair. What will you do? Suppose your boyfriend just bought a LV wallet for you and it was stolen by a thief, what will you do? If these products are bought by debit card or domestic credit card, we are sorry to inform you that your only way to ease your depression may be crying hard in the toilet. However, if these products are bought by US credit card, you don』t need to worry about it at all and you may get 100% compensation.

Compared with the credit card of other countries, US credit card has two most obvious advantages: First, sign-up bonus is very decent. The sign-up bonus you get from applying a US credit card is often enough to redeem a round trip air ticket; Second, there are abundant benefits for credit card consumption including Purchase Protection, Price Protection, Extended Warranty and Auto Rental CDW etc, which made your credit consumption more reliable. However, most credit card users often ignore the second point. Today, let』s discuss the great potential benefits of US credit card purchase protection.

What is Purchase Protection?

First, let』s look at what is Purchase Protection. For example, Chase Sapphire Preferred (CSP) is very familiar to everyone. In its application page, it introduces the benefit of Purchase Protection as follows:

PURCHASE PROTECTION: 

Covers your new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account.

Covers your new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account. It is noteworthy that the Purchase Protection of this card only covers two kinds of loss, i.e. damage or theft. As a matter of fact, the Purchase Protection scope of most credit cards is also the way most losses happen (Otherwise what other methods can you figure out to damage it or lose it? Purchase Protection will be rejected, if you give your products to others-_-).

Purchase Protection and Extended Warranty is easy to be confused. Generally speaking, Purchase Protection refers to certain compensation offered by credit card company, if the purchased products are stolen or damaged at the beginning period of purchase; while Extended Warranty refers to an extra warranty period offered by credit card company after manufacturer』s warranty period. Regarding comparison and conclusion of Extended Warranty of credit card, please refer to Credit Card Perks Summaries: Extended Warranty.

Covered Scope of Purchase Protection

Let』s still take Purchase Protection of CSP for instance. The introduction is mentioned in its detailed terms. If the product is purchased by the credit card or its ultimate rewards, it will be covered by the purchase protection of the credit card no matter where you buy it or for what purpose.

Products not included: living animal or plants, cultural relic, transportation vehicles such as ship, plane and car etc., software, mysteriously disappeared stuff(what』s this?), stuff delivered by express company(including USPS, shipping etc.), jewelry or watch that is beyond the control scope of the client, stuff that is damaged by war or natural disasters, medical equipment, perfume, skin care products, air ticket, ship ticket and second-hand stuff.

Claim purchase protection

Let』s still take CSP for instance. First, you shall call customer service within 90 days against product damage or theft. Relevant departments of credit card company will look into the case and send a table of Claim Purchase Protection to you. You shall prepare and submit relevant documents within 120 days against product damage or theft.

Documents for Claiming Purchase Protection

Let』s take my own experience of CSP claim for instance. I have submitted the following documents as per requirement. My complaint is handled very quickly and I get the check.

1. Fill the Claim Table based on facts.
2. Product purchase receipt(the receipt shall contain the last few numbers of the credit card).
3. Credit card bill(the bill shall include purchased time, the seller, product description and product price).
4. If the product is damaged, you shall ask for damage evaluation and estimated price from an authorized repair place. For example, if your Macbook is broken, you can get an evaluation report in Apple Store.
5. If the purchased product is stolen, you shall get a police report. You』d better call the police within 24 hours against the theft, and you shall introduce the theft to the police in detail and get a case report. Several days later, you shall contact the police station again to get a police report. Normally, it costs you more than ten US dollars.
6. If other insurances cover this product, the purchase protection of the credit card is secondary. That is to say, you can only get compensation from credit card company if other insurances don』t cover this product, i.e. if there is no other insurances, only credit card company will compensate for your loss. I think most people won』t buy other insurances initiatively when they learn this benefit of credit card. ^_^ It is noteworthy that the client shall prepare an insurance declaration page (Chase and Citi are rather strict in this respect, while Amex is lax) to claim that other insurances don』t cover this product indeed and only credit card can cover the loss. You need to get notarization signature from notary. It seems difficult to get notarization signature. As a matter of fact, each bank has its own notary. You just need to take a valid documentation (driver license, passport etc.) to the bank with your account, sign your name in front of the notary (it is absolutely not allowed to sign before arrival), and ask the notary for notarization seal.

Compensation Limit

After you send all required documents to relevant departments of credit card, they will review your documents within 2 or 3 weeks and inform you their decision. Generally speaking, if the required documents and information are complete, they will send you a check with a stroke of the pen (Chase and Citi) or directly give you credit in your account (Amex).

The above mentioned Purchase Protection of Chase and Citi can cover your purchase up to $500 per claim and $50,000 per account. As a matter of fact, they are rather mean. To be more specific, you can only get $500 per claim no matter how much your loss is. In contrast, United MileagePlus Explorer (Chase UA) is much more generous. The Purchase Protection of this credit card covers up to $10,000 per claim (20 times of that of CSP!!) and $50,000 per year. That』s why I never use CSP but Chase UA or Amex Platinum to buy expensive stuff.

Purchase Protection Comparison of Different Credit Cards in Various Banks

Notes:

1. The credit cards issued by Citi Bank cover the loss within 120 days after the purchase for the residents out of NY State. For the residents in NY State, the above credit cards only cover the loss within 90 days after the purchase.
2. Since November 15, 2015, the Purchase Protection terms of Amex PRG will be the same as that of Amex Platinum including Lost. Compensation limit for Lost will also increase to $10,000/occurrence from $1,000/occurrence. (Thanks for the comment by MarkSmith!)
3. Purchase Protection requirements of different credit cards may vary. For example, you can enjoy Purchase Protection of Chase and Amex if you use them to pay for partial payment of that product, but the highest compensation limit shall not be above the partial payment amount. However, you can enjoy Purchase Protection of Citi credit card only when you use it to pay for full payment of that product. So you』d better check the detailed terms of the credit card prior to payment, when you choose to use credit card or gift card or points.

From the above table, the benefits of Purchase Protection of Discover are less than that of other credit cards. It only covers the purchase for 90 days against the damage or theft up to $500 per claim and $50,000 for every 12 months. And the Purchase Protection of Amex Platinum is the best. Different from other credit cards, the Purchase Protection of this credit card not only covers damage and theft, but also covers an important item, Lost. For example, suppose you can』t find the purchased product, it may be stolen or taken by someone else. But you can』t provide enough evidence, in this case, only Amex Platinum can cover your loss. And this credit card can cover your loss up to $10,000 per claim and $50,000 per year.

It is noteworthy that you must be honest when you use Purchase Protection to claim loss. Insurance department of credit card(the Purchase Protection of Chase and Citi etc. is offered by Visa and MasterCard Insurance company etc. the Purchase Protection of Amex is offered by Amex Assurance) will analyze and review the required documents. Sometimes, they may require you to add more documents. If they doubt the truth of the case, they have rights to reject the client』s claim and the credit card may be cancelled. What』s worse, if the claim is a fraud, i.e. the so called 「cheating for insurance」, it will be deemed as felony and the client will be accused and the client shall shoulder relevant law obligations.

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