Credit Cards

How Your Credit Cards Can Protect Your Holiday Purchases

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Between gift buying and travel, the holiday season can be particularly expensive. This year is a little different due to the ongoing pandemic, but many families are still making do even if it means skipping in-person festivities. It's even having an effect on how people plan to pay for their purchases—an Experian survey found that more than 57% of shoppers tend to use credit cards instead of cash when holiday shopping this year, an 8 percentage point increase over last year. As you plan your holiday purchases, don't forget about the many protections and benefits that you could be eligible for if you use a credit card rather than a debit card or cash.

Product-Related Purchase Protections

Here are some of the protections you might receive if you purchase a product or gift with your credit card:

  • Return protection: Some retailers extend their return periods during the holidays, but that's not always the case. Fortunately, many credit cards offer return protection, which allows you to return and get a refund on eligible purchases even if the merchant doesn't accept a return. The benefit usually extends your return period to 60 or 90 days after a purchase and may be limited to $250 to $500 per claim. Some purchases might not be eligible, such as jewelry, animals or plants, and you may need to pay for return shipping.
  • Purchase protection: This valuable benefit can reimburse you if an eligible item you buy is damaged, lost or stolen. The protection generally applies for 60 to 120 days from the purchase date, and there may be a limit on the reimbursable amount, such as $500 or $1,000 per item. However, premium cards, such as the Chase Sapphire Reserve®, offer up to $10,000-per-item limits. There are usually annual and lifetime benefit limits to keep in mind as well.
  • Extended warranties: Many credit cards offer extended warranties on eligible purchases. The benefit can give you an additional year or two of coverage if an item is originally covered by a manufacturer's warranty. An extended warranty can apply even if you gift the item, although the recipient may need a copy of your credit card's billing statement when they go to make a claim.
  • Price protection: The price protection benefit lets you get a refund if an item's price drops soon after you make a purchase. Unfortunately, only a few cards still offer this benefit, such as the Capital One Platinum Credit Card.
  • Cellphone protection: A purchase-related perk that some credit cards offer, cellphone protection could cover part of the cost of replacing a lost or damaged phone if you pay the monthly phone bill with your credit card. It could be worth looking into this if you plan on buying yourself (or a family member who is on your phone plan) a new phone.

The eligibility, requirements, limits and claim process can depend on your card, and you'll want to read over your cards' benefits to understand what your card offers and ensure your purchases qualifies.

Travel-Related Insurance and Benefits

Holiday travel will certainly be different this year. The Travelocity 2020 Holiday Outlook survey found 60% of people don't plan on traveling to visit family or friends this year. If you're part of the 40% who will—or you're simply planning a trip to get out of the house—then a credit card's travel insurance and benefits could be important. The coverages may include:

  • Rental car collisions and damage coverage: A rental car collision damage waiver covers damage to and theft of a rental car, but it doesn't cover liability claims, such as damage to other vehicles or property. Depending on the card, the coverage may be secondary to your auto insurance policy, if you have one. However, some cards, such as the Chase Sapphire Preferred® Card, come with primary coverage. The coverage can lead to significant savings versus paying for coverage from the rental agency, especially if you're planning a long holiday road trip.
  • Travel accident insurance: An insurance benefit that you hope to never use, travel accident insurance may help cover medical expenses if you or a family member is killed or seriously injured (such as a lost limb or eyesight) on your trip. The insurance is also called accidental death and dismemberment insurance.
  • Trip cancellation and interruption coverage: This insurance benefit may reimburse you for nonrefundable expenses if you have to cancel your trip or end it early due to injury, illness or death of the cardholder, a family member or someone on the trip. It may also cover cancellations and interruptions due to severe weather. We took a closer look at whether these protections will cover incidents related to COVID-19 in a separate post.
  • Trip and baggage delay insurance: Trip and baggage delay insurance protections can reimburse you for expenses you incur due to delays. For example, with the Chase Sapphire Reserve®, you could get up to $500 per ticket for meals, lodging, toiletries and personal items if your trip is delayed by over six hours or you have to stay somewhere unexpected overnight. You could also receive up to $100 a day for up to five days for clothing, toiletries and a cellphone charging cable if you're left waiting for your bags.

As with the purchase benefits, the eligibility, requirements and limits can vary widely for travel-related insurance and benefits. Check to see what perks a card offers and what you need to do to receive the coverage.

Should You Get a New Card for the Holidays?

You may already have a credit card that offers purchase and travel perks, but review your card's guide to benefits to better understand how using the card could keep you protecting during the holidays.

It may also be worth getting a new credit card specifically for purchase or travel benefits that your card lacks. For example, the Chase Freedom Flex℠ doesn't have an annual fee and it offers cellphone protection (in addition to cash back rewards, purchase protection and extended warranties).

You may also want to look into cash back cards for the holidays. However, don't let the appeal of earning rewards lead you to overspend. Prepare ahead of time with a budget and plan, and then use a credit card to make the purchases and get rewards.

Or, if you think you'll need to pay off the balance over time, a card that offers new cardholders an intro 0% annual percentage rate on purchases could save you money on interest. Plus, some cards offer an intro bonus if you use the card to spend at least a certain amount during the first few months your account is open.

Compare Cards Before Applying

If you think you may benefit from a new credit card—or you want to see how your current cards stack up—compare cards' fees, rewards and benefits. Experian's CreditMatch™ service can make this easier by allowing you to filter cards based on your preferences. In most states, the tool can also match you with cards and personalized offers based on your credit profile.

Also, be sure to check up on your credit beforehand to make sure you've addressed anything that could be holding you back. Your credit reports are available for free from all three credit bureaus from You can also get your free credit report and score directly through Experian.