Hidden benefits of credit cards that nobody tells you
Hidden benefits of credit cards that nobody tells you

Hidden benefits of credit cards that nobody tells you

Posted on

Benefits of credit cards that nobody tells you: Since credit cards are affordable and easy to repay, consumers often use them as a short-term loan. Besides, the line of credit is revolving, it has already been approved, and it can be used in any store, restaurant, hotel or e-commerce in the country. These are the expected benefits, but credit card users should also be aware of hidden benefits.

Additionally, you can use your card to pay for your services, your mobile phone plan, and monthly subscriptions (such as Netflix). You could request cash advances or consolidate debts from other credit cards through a balance transfer.

What are the hidden benefits of credit cards? While some are obvious (like rewards, points, and cash back), others are less apparent. It would be sufficient to read through the contract and the terms and conditions section to find out what benefits you could get from credit cards.

Most banks will send you this document by mail, but you can also find it online.

Note: Several of the benefits we will discuss in this article require that you hold the card and make your purchases using it instead of another form of payment.

If you buy a washing machine with cash and the manufacturer’s warranty expires, you won’t be able to ask your credit card company to extend the warranty. The credit card option is also available if you make the purchase with it.

Are there any hidden benefits of credit cards?

When you use a credit card, you can enjoy the following advantages:

  • shopping insurance
  • Extended Warranties
  • price protection
  • luggage protection
  • mobile phone insurance
  • Free checked baggage
  • Guaranteed returns
  • accident travel insurance
  • Access to the airport VIP lounge
  • Rental Vehicle Damage Waiver
  • Trip cancellation or interruption insurance

Keep Reading: What is the balance on a credit card?

Let’s examine these benefits in more detail.

1. Shopping Insurance:

Do you enjoy online shopping? You’ll be glad to know that many credit cards offer purchase insurance. What does it cover? A product that is damaged, deteriorated, used or simply lost or stolen will be refunded or replaced by the issuer if it arrives damaged, deteriorated, used, or simply lost or stolen. Additionally, you can use this insurance if, for example, you ordered a new microwave or LCD TV with your credit card and you dropped it when you were installing it. 

The amount of purchase insurance varies from card to card. If you want to know what your insurance covers, you can check it out directly with the bank or in your affiliation contract.

Note: You may be able to receive insurance for up to 120 days after you purchase a credit card with a high-end rating. Premium cards typically have a limit of around $10,000 per claim or $50,000 per year.

2. Extended Warranties:

Don’t all products or electronic devices come with a manufacturer’s warranty? In many cases, however, this period can easily reach 5 years or, in some cases, even 10 years. Depending on what the original guarantee stated, you may be able to extend this guarantee for an additional year or more if you purchase that product using your credit card.

Suppose you purchased a laptop using a credit card. Depending on the product’s eligibility and the issuer’s conditions, the warranty could exceed the manufacturer’s warranty by 24 months. The coverage applies to both repairs and the cost of replacing the product. Therefore, if your laptop breaks during that period, you could receive the money it costs to repair it, a new laptop – or the full amount you paid for the product.

The council. You should keep in mind that the issuer may place certain price limits, especially for large or expensive items. Be sure to review your card’s policy and keep both a copy of your receipt and the manufacturer’s warranty. Otherwise, you will not be able to file a claim.

Keep Reading: Transferring money from a credit card to a bank account

3. Price Protection:

It is no longer enabled on all cards (because it has fallen into disuse), but some still provide it.

But what is it for? A consumer benefit that operates if the price of a product that he purchased falls in price. Exactly how does it work? Here’s how. Imagine you bought a new computer for $1,000, but suddenly the price dropped to $700. You can, in this case, make a claim to the bank and, if eligible, you would receive a refund for the difference.
Even if the store that lowered its prices is different from where you bought the good, the protection is still in effect. Credit card companies condition price drops on the use of their cards, so you must consider that. A claim can generally be filed within 100 days of purchase and includes any price changes that occurred within that period.
NOTE: The bank does not monitor the prices of products you have purchased with your credit card, so you get to enjoy this benefit. Therefore, if you want to claim it, you should check several stores frequently to see if the price has dropped or not.

4. Luggage Protection:

Perhaps one of the most useful benefits, especially for frequent travellers.

If your baggage is lost and you paid for the check-in, or the ticket, with your card, the issuer will reimburse you for any expenses you incur due to the delay. The maximum reimbursement limit is $100 per day and applies until your luggage is found and returned.
If the luggage never arrives, the issuer will refund the value of everything you had in it. If the credit card is high-end, it not only protects the cardholder’s luggage, but also those of their family members, even if they are not traveling with them.

5. Mobile phone insurance:

When you buy your next mobile phone with your credit card, you can get insurance against loss, theft, or damage.

You could also apply this scenario to those who pay for their mobile plans with their credit cards. Of course, the insurance could be conditioned by the bank. You can find banks that not only require you to purchase your mobile phone with your card, but also that the phone plan is tied to it.

Additionally, some policies may have deductibles, such as $100, and a maximum claim amount, usually less than $600. Consumers are generally limited in the number of claims they can make in a 12-month period.

6. Free checked baggage:

Most credit cards (especially those with rewards and frequent flyer miles) offer the option of covering the cost of checked bags as long as the trip is paid for with the card. Cardholders with some cards are even covered for the cost of their fellow traveller’s checked baggage.

7. Guaranteed returns:

It may already be clear to you, but a guaranteed return is nothing more than a refund to the consumer. Where does this work? When you buy an item in a store and need to exchange it for another, but the store never made the withdrawal.

This benefit can vary from card to card, but most allow claims 90 days after purchase and are capped at $300 per product or up to $1,000 per year.

Keep Reading: How do credit cards and debit cards differ?

8. Accident travel insurance: 

Travel insurance is one of the best known benefits, but if you don’t know it, we introduce you to it!

When paying with a credit card for a plane ticket, the consumer or his family is covered by travel insurance. Under what circumstances is this coverage available? The consumer or a family member dies or suffers an accident during the trip.
Insurance coverage can easily exceed $500,000 (some even exceed a million dollars) but the amount received depends on the type of injury. An accident travel insurance policy, for example, would cover about $500,000 in case of accidental death or dismemberment. This amount could be halved if the beneficiary loses a hand, foot, or sight in one eye.

9. Access to VIP lounges at airports:

A trip with stopovers or problems with the flight can be very irritating if you have to wait at the airport. You may be able to access the airport VIP lounges without paying a single penny if you pay for the ticket with your credit card or if you have a frequent flyer plan.

The cardholder’s fellow travellers may enjoy airport lounge benefits for free on some cards, while others charge between $25 and $50 per person.

10. Car Rental Damage Waiver:

Most of the credit cards included in the country’s financial catalogue provide special coverage for car rentals during the trip (especially those that offer rewards, bonuses, prizes, and miles).

If the primary policy does not fully cover the loss of the car, this insurance is in addition to anything else the consumer may have. The scope of the policy may vary, depending on the card. For this reason, it is important to read the terms and conditions provided by the bank or issuer before traveling and making the claim.
You may be surprised to learn that high-end credit cards often offer coverage that may even pay out to the beneficiary before their own primary insurance does. This $150,000 policy has coverage of $75,000, about 25% of the policy’s face value.

11. Insurance for cancellation or interruption of trips:

In the event that your next vacation is cancelled or delayed due to bad weather, sickness or any other reason beyond your control, you are covered under this policy. A card must have been used to pay for the trip in order to access it. Otherwise, you will not be able to access it.

Many hotel reservations or airline tickets lose their “refundable” status as the travel date approaches. Therefore, insurance like this could come in handy. As long as the airline or accommodation does not respond to the claim, the cards offer a refund of up to $1,500 per person (or up to $6,000 per trip).

What’s our recommendation? Compare the benefits of all your cards and choose the card that provides the best plan for buying tickets or reserving accommodations.

Take advantage of your credit card benefits!

Even though we have made a fairly extensive list, these are just a few of the hidden benefits of credit cards. You can learn more about the advantages of your card by checking the contract, contacting the bank or visiting any branch! You may also find relevant information about the benefits on the website of your bank or issuer.

Don’t forget. All of these benefits can only be claimed if the purchases and reservations are made using that credit card.

Our recommendation? Choose the best plan for purchasing or reserving tickets and accommodation by comparing the benefits of all your cards.

Feel Free to Comment Us!