5 Credit Cards That Act As Warranties

NEW YORK (MainStreet) — One of the key choices shoppers must make when purchasing most electronic products and appliances is whether it’s worth forking over the extra money for an extended warranty, but what many don’t realize is they already have one.

Visa (Stock Quote: V) and MasterCard (Stock Quote: MA) both offer complimentary extended warranty and purchase protection with many of their cards, while American Express (Stock Quote: AXP) provides coverage for all cardholders. (Discover cards offer warranty protection as well, though only for a fee that varies based on the product and the card.) While the plans differ slightly, each card that has it can automatically extend the manufacturer warranty for upwards of a year or more and the plan insures the product against loss or damage in the first 90 days after purchase as long as the customer used the card to buy the product. Still, many cardholders are unaware of their own coverage.

“Not a lot of consumers take advantage of this coverage,” says Odysseas Papadimitriou, CEO of the credit card comparison site CardHub.com. “If a product breaks down and their manufacturer’s warranty has run out, they don’t think about whether they used their Visa card to make the purchase.”

In fact, CardHub estimates that less than 5% of cardholders actually make use of the warranty benefits that come with their card, which could be the result of two factors. First, the coverage is automatically included on the cards that have it – with the exception of Discover cards – meaning it might fly under the radar for those cardholders who aren’t looking for it. What’s more, even those who know they have coverage may have some difficulty finding out the exact details.

What Protection Does Your Card Offer?

Unlike most credit card perks, warranties are generally offered by the credit card network (Visa, for example) rather than through the issuer (like Chase or Bank of America). In theory, that should make it easier to determine whether and how much you’re covered, except that the credit networks still offer different amounts of protection for different categories of cards and don’t offer it for everyone.

Visa only provides warranty protection for its Signature cards, according to a company spokesperson, which are considered the company’s premium products and include cards like the Chase Sapphire and Chase Freedom Signature. With these cards, Visa will double the original manufacturer warranty for up to one year extra on any warranty that’s one year or less. These cards also ensure you purchase protection, meaning you can replace or repair most products worth $500 or less if it’s been lost or accidentally broken in the first 90 days after the purchase date.

MasterCard offers nearly identical protections, but it is a bit more vague on which cards apply, and those that do tend to be very exclusive. A company spokesperson told MainStreet that “most” of MasterCard’s Gold and Platinum cards offer these protections, as well as the World and World Elite cards. Many of the company’s professional and consumer debit cards also come with the warranty and purchase protection, making this perk a little more attainable for the average consumer, though still vague.

On the other hand, all of American Express’s cards, with one exception, extend the warranty by up to one extra year for any original manufacturer warranty of five years or less. The exception is the ultra-exclusive Centurion card – better known as the Black Card – which extends the warranty for three years. Each of these cards also offers 90-day purchase protection.

For this reason, credit experts generally consider American Express to be the best of the bunch when it comes to warranty protection.

“AmEx really tries to maintain a branding image of being the most generous card out there,” says Tim Chen, founder and CEO of NerdWallet, an online credit comparison tool. Aside from offering warranty protection to all customers, American Express also offers return protection for up to $300 per item for any item you just don’t like, which is more than the $250 offered by MasterCard and the $200 offered by Visa, Chen points out.

Even knowing this, it can still be difficult to figure out which card to choose. To make the selection process a little easier, MainStreet picked out five great cards that have these protections with the help of our credit experts.

BankAmericard Cash Rewards Visa Signature Card

Annual Fee: None

Extended Warranty: Up to one year extra coverage for manufacturer warranties of three years or less.

Purchase Protection: Will replace or refund product if stolen or accidentally damaged in first 90 days for up to $500 per incident.

Citi Platinum Select MasterCard

Annual Fee: None

Extended Warranty: Doubles manufacturer warranties of one year or less as long as the original warranty is not for longer than one year.

Purchase Protection: Will replace or refund most products that are stolen, accidentally damaged or lost in a fire in first 90 days for up to $1,000 per incident.

American Express Green Card

Annual Fee: $95 after the first year

Extended Warranty: Up to one year extra coverage for any manufacturer warranty of five years or less.

Purchase Protection: Will replace or refund most products that are stolen or accidentally damaged in first 90 days for up to $1,000 per incident.

Blue from American Express Credit Card

Annual Fee: None

Extended Warranty: Up to one year extra coverage for any manufacturer warranty of five years or less.

Purchase Protection: Will replace or refund most products that are stolen or accidentally damaged in first 90 days for up to $1,000 per incident.

Capital One No Hassle Rewards Credit Card

Annual Fee: $39

Extended Warranty: Doubles the original warranty for up to one year as long as the original warranty is not for longer than one year.

Purchase Protection: Will replace or refund most products that are stolen or accidentally damaged within the first 90 days for up to $500 per incident.

How to Use the Credit Card Warranty Protection

The benefit of having a credit card with its own warranty protection is that it eliminates some of the need to buy additional coverage with each product you buy, but according to Chen from NerdWallet, redeeming credit card warranties can be trickier than going through a retailer.

“There are definitely a few more hurdles when you go through the credit card network for the warranty,” he says, though just how many hurdles depends on the particular claim at hand. In some cases, Chen says the cardholder will need to file a police report, or mail in the damaged item.

There will also be a lot of paperwork involved. Chen says that cardholders will need to have a copy of all receipts and the written warranty on hand to make use of the coverage, with the exception of Visa cards, which allow customers to register their purchases in the company’s warranty management system.

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