Credit cards with the best extended warranties and shopping protections

While these perks are fading, you can still find them in select cards – but is there any value left in these benefits?


It hasn’t been a good couple of years for credit card retail perks – that is, extras such as extended warranties, price protection and purchase protection. While these perks are fading, there are cards that still offer them, but is there any value left in them?

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It hasn’t been a good couple of years for credit card retail perks – that is, extras such as extended warranties, price protection (refunds if you buy something and the price subsequently drops) and purchase protection (insurance for lost/damaged items).

Citi discontinued a slew of benefits in September, headlined by the demise of its once-industry leading Citi Price Rewind program. That used to cover price drops up to $500 per item and $2,500 per year. The benefits were reduced in mid-2018 and recently killed off entirely.

Discover and Chase made major cutbacks to their programs last year. American Express will halve its extended warranty coverage beginning in January. Mastercard recently discontinued price protection on all of its cards. And the Uber Visa Card is ceasing its price protection and extended warranty programs at the end of the month.

Card issuers claim these programs weren’t getting much use. There’s some truth to that, but also some marketing speak. Price protection, in particular, was catching on. So much so that it was being automated and gamed. Web crawlers were finding lower prices (even on sketchy sites), and consumers’ gains were issuers’ losses.

It would be more accurate to say these perks were used enough to cost the issuers a noticeable amount of money – Citi paid $17.5 million in Price Rewind claims last year – but not enough to attract and maintain a sufficient number of valuable customer relationships. I suspect that a small number of cardholders were using these programs to an outsized degree.

Is there any value left in extended warranties, price protection or purchase protection?

See related:  Your credit card updated its rewards rate – here’s what to do next

Credit cards that offer extended warranties

This is where the best value remains. For example, most Citi cards (not the Citi® Double Cash Card or Citi Dividend cards, however) still offer generous extended warranty benefits. That means a two-year extension of the manufacturer’s warranty, with total coverage (up to $10,000 per item) not exceeding seven years from the purchase date.

Consumer Reports says you can expect to pay a retailer an average of $126 for an extended warranty on a large appliance and $21 on a small appliance.

On a sizable purchase, Citi’s extended warranty coverage is worth it, even if it means sacrificing some rewards. Let’s say you bought a $1,000 refrigerator. If you used your Citi Premier℠ Card, you’d get 1 point per dollar on a refrigerator (for a total return of $10 to $15 by my estimation).

An alternative would be to use the Bank of America® Cash Rewards credit card. Its extended warranty plan doubles the manufacturer’s warranty up to one extra year. You could get more rewards from this card – at least 3 percent cash back if you select the right category, such as online shopping or home improvements and furnishings – although I think Citi’s additional year of coverage is better.

Even if you got the Bank of America card’s highest return (5.25 percent cash back if you keep at least $100,000 with the bank), that would only be $52.50 on a $1,000 purchase. An extra year on your warranty is worth more than the rewards difference between these cards.

See related:  Earn a sign-up bonus on the Citi Double Cash Card when you apply in-branch

Credit cards that offer price protection

A handful of cards still offer price protection, but there’s a significant opportunity cost with all of them.

For instance, you can get coverage (up to $250 per item and $1,000 per year) with the U.S. Bank Cash 365 American Express Card, but the card only pays 1.5 percent cash back on purchases. I’d rather get a guaranteed 2 or 3 percent in cash back than a hypothetical refund for a price drop within 30 days. Particularly since there are notable exclusions (such as price comparisons found on the internet).

While they lack price protection, in this instance, I think the Bank of America Cash Rewards card and the Citi Double Cash (1 percent cash back when you buy something and another 1 percent when you pay it off) would be more valuable.

You’re better off chasing rewards than price protection, especially since many retailers have their own price-matching programs.

See related:  USAA removing price protection benefit, expanding other card perks

Credit cards that offer purchase protection

The most generous coverage is offered by cards with high annual fees, such as the American Express® Gold Card ($250) and the United MileagePlus Club Card ($450). Cardholders get up to $10,000 of purchase protection per incident (capped at $50,000 per year), within 120 days (90 for New York residents).

That could be worthwhile if you already get other value from these cards, but it’s not a reason in and of itself to pay a hefty annual fee.

More modest – but still potentially useful – coverage is available on the no-annual-fee Blue Cash Everyday® Card from American Express, the Wells Fargo Propel American Express® card and the Chase Freedom.

The two no-annual-fee Amex cards offer $1,000 of purchase protection per incident, and the Chase Freedom extends $500 of coverage (all have a $50,000 annual limit). The coverage term is 120 days (90 for New York residents) on the Blue Cash Everyday and the Chase Freedom, and 90 days for all Propel cardholders. The Amex Gold and Blue Cash Everyday periods will drop to 90 days nationwide on Jan. 1, 2020.

The Chase Freedom is particularly enticing this quarter because its 5 percent cash back categories are select department stores, PayPal and Chase Pay (after activation, on up to $1,500 in quarterly spending, then 1 percent cash back after that).

It’s hard to find cards that offer generous rewards on the kinds of merchandise that are well-suited for purchase protection. Even beyond Dec. 31, Chase has a lucrative online shopping portal, so if you can get better rewards and some peace of mind, that’s a win in my book.

Information about the Citi Premier Card, U.S. Bank Cash 365 American Express Card, and United Mileage Plus Club Card has been collected independently by The issuer did not provide the details, nor is it responsible for their accuracy.

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