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Credit card purchase protection is one of the benefits of having a credit card that often gets overlooked. Yet, it’s one of the advantages that makes paying with your credit card that much more valuable.

Here is a look at the different forms of protection that your credit card may offer, from coverage for auto rentals to extended warranty programs. The more you know about what your card offers, the more you can gain out of being a savvy credit card owner.

What Is an Auto Rental Collision Damage Waiver?

If you like to travel, having an auto rental collision damage waiver, or Auto Rental CDW, can be a huge advantage. This form of purchase protection provides insurance coverage for automobile rentals. In the case of collision damage or theft, your credit card issuer will provide reimbursement up to the cash value of the rental.

How to make sure your Auto Rental CDW goes into effect? Follow these tips:

  • The primary car renter must be the eligible card owner
  • Any additional drivers have to be listed on the auto rental agreement
  • You’ll need to complete the rental transaction with the eligible card and decline the auto rental company’s collision damage waiver

Make sure you check your card’s benefit details and read the terms and conditions so you are aware of what is and isn’t covered. Credit One Bank’s Visa® and Mastercard®, for example, provide the following Auto Rental CDW benefits:

  • Physical damage or theft of the covered rental vehicle
  • Valid loss-of-use charges imposed and substantiated by the auto rental company
  • Towing charges to the nearest repair facility

What Is Travel Accident Insurance?

Similar to life insurance, with travel accident insurance, your beneficiaries would receive a principal sum in the case of accidental death or dismemberment while you are traveling. This is a fantastic protective benefit, so check with your card issuer to see if you have an eligible card and what the terms are. Credit One Bank’s Visa and Mastercard both have a principal sum death benefit of $150,000, as well as a percentage of the principal in the case of accidental injury.

With this feature, you don’t need to do anything to activate it. The primary card holder and any dependents are automatically covered once the transportation fare is charged to the credit card. Any scheduled airline, land or water carrier that is licensed for the transportation of passengers is considered to be a Common Carrier, and you are covered when traveling with their service.

What Is Purchase Protection on Credit Cards?

Credit card purchase protection acts like an extra layer of security on your purchases. It is essentially  "Purchase Protection Benefits" short-term insurance; for the purchase of everyday items in case they are damaged or stolen. The protection lasts for a set period of time.

Most purchases are protected so it’s easier to keep track of the items that aren’t usually covered:

  • Tickets
  • Collectibles
  • Vehicles
  • Gift cards
  • Used goods
  • Permanent fixtures such as a carpet or air conditioner

Keep in mind, items that are lost due to mismanagement or neglect often won’t be covered. For example, if you lose your new sapphire earrings because someone stole the bag you were carrying them in, your purchase may be covered. Lose them because you left them at a friend’s house and now you can't find them—your claim may not be covered.

What Is Extended Warranty Protection?

With extended warranty protection, you may have an additional year of warranty coverage for eligible items. This extended warranty will cover whatever the original manufacturer’s warranty covered.

Simply charge the item on the card that has the warranty protection. Then, make sure you save the receipt and the manufacturer’s warranty documentation. If the product breaks down after the original warranty expires, you may still be reimbursed through your credit card.

If you’re not sure what type of purchase protections your credit card offers, ask a customer service representative from your card issuer. You can save money and enjoy peace of mind with the benefits you are already entitled to!

This material is for informational purposes only and is not intended to replace the advice of a qualified tax advisor, attorney or financial advisor. Readers should consult with their own tax advisor, attorney or financial advisor with regard to their personal situations.