Protection on the cheap

Did you know that many major cards will extend product warranties – even for goods you plan to give as gifts – as well as cover repairs due to accidental damage? And coverage is free. 

With the average household shackled with more than $9,000 in credit card debt, it would be irresponsible of us to encourage shoppers to buy more than they need to and spend more than they have to. But if you’re planning a significant purchase, there is a distinct advantage to putting it on plastic. 

Aside from the certain basic entry-level cards, like Visa Classic, most personal credit cards will automatically double the length of the manufacturer’s original warranty by up to one year, if you charge the product’s entire purchase price. A 90-day warranty on a digital camera, for example, would be doubled to 180 days. Similarly, any product with a manufacturer’s warranty of one year, would be covered for an additional year. There are a couple of caveats. American Express won’t offer coverage for products that come with warranties of longer than five years, which is a rarity. Visa limits coverage to products with original warranties of three years or less. MasterCard won’t extend the warranty of any product with an original warranty in excess of one year. In addition, if you purchase an extended warranty from the manufacturer or retailer, you’re generally not eligible for the free protection. 

The good news is that these free extended warranties are applicable to products you give as gifts. Just be sure to keep the necessary documentation such as the original receipt, charge slip, and monthly statement, product serial number, and copy of the manufacturer’s warranty. Of the big four credit card issuers, only Discover does not offer this extra free peace of mind. 

The benefits don’t stop there. Here’s a rundown of some valuable perks from American Express, Visa, and MasterCard you might not know about. Obviously, these are only highlights and, as you might expect, there’s lots of fine print. Conditions and exclusions apply, and benefits vary according to the bank issuing the card. So be sure to check with the bank first for specifics. In general, though, you’ll find the benefits are quite generous. 

• American Express Blue, Green, Gold, and Platinum cards. The “Buyer’s Assurance Plan” mirrors the manufacturer’s warranty terms, and kicks in immediately after the original warranty expires. Products bought with a Blue, Green, or Gold card automatically extend the original warranty for up to one year.

No matter which color card you keep in your wallet, you’re protected for the first 90 days from accidental damage or if your product is stolen – losses not normally covered by the manufacturer. The Platinum card will replace or refund the purchase price of products that you lose during the first three months of ownership.

It’s up to American Express -– or any credit card company, for that matter -- whether to repair, replace, or refund the purchase price of your product. The plans won’t pay for shipping and handling expenses, installation, or tech support. You don’t have to sign up for coverage. It’s automatic (as long as you keep your card and are a U.S. resident).

To file a claim, you’ll need proof of purchase; so keep and make copies of all original documents and warranties. In some instances, you may be required to return the damaged item for inspection.

Used, rebuilt, or refurbished products are typically excluded, as are “gray-market” goods -- those lacking a valid U.S. warranty that were intended for sale abroad. Nor does the warranty cover plants, animals, or motorized vehicles (cars, boats, and the like), and components subject to normal wear and tear like tires, brakes, and batteries.

There are a few other exemptions. If your computer is fried by a power surge, for example, or you’re unusually rough on a particular product, you’re out of luck.

You have 30 days from the time the product breaks to file a claim. More information appears on the American Express Web site. 

Another freebie from American Express is what the company calls “Return Protection.” This program gives cardholders 90 days to get their money back if they’re dissatisfied with their purchase (priced $300 or less) for any reason and the retailer refuses to take back the product. Again, certain products are excluded, but not goods such as small appliances and home electronics.

• Visa and MasterCard. Visa’s “Warranty Manager” applies to many Signature and select Gold and Platinum cards, and is fairly similar to the American Express “Buyer’s Assurance Plan” in terms of what’s covered and what’s not, but you have twice as much time to file your claim after a product failure, 60 days. MasterCard Gold and Platinum cardholders have 30 days to report a failure or you won’t qualify for extended coverage.

Like American Express, both Visa and MasterCard will automatically double the length of the original warranty for up to one year. More information from Visa is available here. MasterCard customers can get details here. 

There’s no requirement to register your purchases in advance. But if you do with Visa, for instance, by mailing in sales and charge receipts, product serial number, and a copy of the manufacturer’s warranty, you’ll be able to expedite the claim process.

With many Visa cards, holders are further entitled to free repairs for the first 90 days for damages resulting from accidental damage, vandalism, or bad weather. You can also get a refund or replacement during that period if you’re the victim of theft. Visa offers a 60-day satisfaction guarantee with any product you buy. If you don’t like it for any reason and the retailer won’t take it back, Visa will.

Some Visa cards also come with price protection. If within 60 days of purchase you find the item for less at the same or any other store or Web site (excluding an auction site) Visa will refund the difference if you can provide documentation.

Comments

[JS]

the purchase protection plan is an EXCESS plan, i.e., if you have home owner insurance, American Express will pay the difference after the home insurance policy. The question is: what if your home insurance deductable is $5,000 and your damaged item worth only $200?

[Lani]

Have you ever tried to go through Visa to rectify a problem with a purchase (for instance, being charged twice for something)? They are a nightmare.