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Credit card protections and insurance might be lesser-known benefits compared with rewards, but they can offer serious savings. These perks often focus on either travel or retail purchases you make with your credit card, and the specific benefits can vary by card and over time. Here are the protections and insurance benefits to look for in 2022.
Credit Card Travel Protection Trends in 2022
You typically need to book your trip, lodging or other service with the card that offers these protections to be eligible for them. Credit cards' travel purchase and insurance benefits may include:
- Trip accident insurance: Offers coverage for when a traveler is killed or seriously injured during a trip. Serious injuries may include loss of speech, sight, hearing or a limb.
- Trip cancellation and interruption insurance: May reimburse you if your trip is canceled or cut short due to a covered event, such as covered illnesses or severe weather.
- Trip delay insurance: Can cover expenses, including meals, transportation and lodging, if your planned trip is delayed or canceled.
- Baggage delay insurance: Can reimburse you for necessary purchases, such as clothing and toiletries, while you wait for your bags to arrive.
- Roadside dispatch or assistance: Could either help connect you with nearby roadside help while you're on the road or help cover the cost of certain services.
- Auto rental collision damage waiver: Primary or secondary coverage for when a rental car is damaged or stolen.
"During COVID, some issuers tried to replace travel-related benefits with more lifestyle benefits," says Peter Alter, vice president at CBSI, which provides benefits services to card issuers. "Those are still popular, but now there's a renewed interest in travel insurance benefits."
Travel Insurance Is Still Top of Mind
In part, travelers may be worried about canceled trips due to a new surge of coronavirus cases at their destination. Additionally, many carriers are struggling with staffing shortages, and they may have fewer routes than before the pandemic.
"There's not enough redundancy to pick up the slack. In turn, that's created a greater expectation for travel insurance [claims]," Alter says. "Trip cancellation and interruption remain the big ones."
Booking your airfare with a card that offers trip cancellation, delay and interruption coverage could help you save a lot of money. But review your card benefit's fine print, as the eligible circumstances and benefit amount can vary.
The Auto Rental Collision Damage Waiver Benefit May Offer More Savings
Credit cards' auto rental collision damage waiver benefit could be especially important in 2022.
Rental car agencies are also feeling the impact of labor and supply chain shortages, which can make replacing and repairing vehicles more expensive. As a result, Alter says, "rental car agencies may take a closer look at vehicles when they're returned." He adds that agencies may also charge you for the time the rental vehicle is unable to be rented out, which could be more expensive if the repairs are taking a long time.
If your card offers the benefit, you should find out if it offers secondary or primary coverage. With secondary coverage, you have to use your own auto insurance before the card's benefit kicks in. But primary coverage will be used first, which can save you from having to make a claim on your insurance that could increase your premiums. (If you don't have auto insurance, a card's secondary coverage will still cover you.)
Visa stopped providing the coverage on the cards in its payment network in 2021, which could make it a little less common in 2022. However, Alter says, "many issuers continued the benefit at their expense because they believe it's an important benefit that resonates with customers."
Credit Card Purchase Protection Trends in 2022
Most credit cards include zero-liability protection for unauthorized purchases, and many offer additional protections on products and services you pay for with your credit card:
- Return protection: Allows you to return a product and get a refund when the original retailer doesn't accept the return.
- Purchase protection (or purchase security): Get reimbursed for products that are damaged, lost or stolen.
- Extended warranties: Extends the manufacturer's warranty on a product.
- Price protection: Can cover the difference between your purchase price and a lower advertised price after you make a purchase.
- Cellphone protection: Reimburses you if your phone is stolen or damaged.
All card benefits above have requirements and limits. For example, return and purchase protections usually only last a few months from the purchase date, and there may be per-claim and annual limits. Or, the extended warranty benefit may only apply to purchases when the original manufacturer's warranty was for one or two years.
More People Are Using the Purchase Protection Benefit
Credit card purchase protection generally lasts 60 to 120 days from the date of purchase, but the benefit limits can vary considerably.
Alter says that he's seen an increase in claims related to "delivery not completed," which he says may be due to the growth of online shopping and increased frequency of porch piracy. However, the increase in claims doesn't mean the benefit is going to be pulled.
"One of the core tenets of using a credit card is protection around purchases," explains Alter. "Purchase security is so closely aligned with why someone uses a credit card, there are a couple of issuers adding it to portfolios that haven't had it."
Other Retail Benefits Remain Popular
Alter says that extended warranties are the other big benefit, alongside purchase protection. Having longer warranties might become even more useful as inflation and supply chain disruption could make replacing items more difficult than repairing them.
Cellphone protection, which was once rare, has also become more popular in recent years. Alter says that trend could continue in 2022 as more issuers add the benefit to their cards.
New Benefits in 2022 and Beyond
Looking to the year ahead, you might notice several new types of credit card benefits.
The first is rideshare protection, a perk that was becoming popular before the pandemic put it on the backburner. The coverage, also called a personal property benefit, may pay to repair or reimburse you if an item you own is lost, damaged or totally destroyed during a trip with a ride-hailing service such as Uber or Lyft. "Perhaps you're getting out of the car and your phone drops and cracks," says Alter. Your credit card could cover the repair if you used it to pay for the trip.
There may also be an increase in benefits that require you to perform a certain action to qualify. For example, a credit card might help pay for your auto insurance deductible if you file a claim, but only if you used the card to make a specific number of purchases the previous month.
Alter also mentioned the launch of a new coronavirus-specific travel protection benefit. Some trip protection benefits might exclude coronavirus-related incidents. But the COVID-19 protection service could help pay for extra expenses if you get COVID-19 while traveling, such as a daily stipend if you have to quarantine.
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