Are Credit Cards With Price Protection Worth It?

Photo (cc) by StockMonkeys.com

More than half of consumer credit cards now offer price protection, but which one to get — if you should even get one at all — can be tricky.

A new analysis by the credit card comparison site CardHub.com found that 53 percent of consumer credit cards (excluding co-branded, student and business cards) have a price-protection program, compared with 49 percent last year.

These programs enable cardholders to receive a refund if they purchase an item and its price drops within a certain period of time. The terms of price-protection policies vary from issuer to issuer and card to card, however.

For example, CardHub’s analysis found that:

  • Price-protection policies work similarly for most issuers, meaning consumers are required to notify the issuer of a price drop and provide proof of purchase and proof that a lower price became available elsewhere. But one issuer (Citi) offers automatic price monitoring to customers who proactively register items.
  • Most policies provide protection for 60 days after purchase, but the policies of some cards provide protection for as much as 120 days.
  • Seventeen percent of cards limit the number of price-drop claims a cardholder can submit per year to as few as four claims.
  • Jewelry is the item to which price-protection policies most commonly do not apply.

Due to such variations, Roger Beahm, a marketing professor at the Wake Forest University School of Business, tells CardHub that leveraging a price-protection policy isn’t necessarily worth a cardholder’s effort:

“[It] depends on three things: (a) the price you paid for the item you bought, (b) the amount of money to be gained by exercising the policy and (c) how much you value your time. … You don’t want to become too preoccupied in monitoring [prices after a purchase].

The top 10 issuers or cards in CardHub’s analysis are:

  • All Chase cards — total score of 87 percent
  • All Discover cards — 84 percent
  • USAA American Express — 78 percent
  • USAA MasterCard – 78 percent
  • All Barclaycard cards — 78 percent
  • All Citi cards — 72 percent
  • Wells Fargo Cash Back — 71 percent
  • Wells Fargo Home Rebate — 71 percent
  • Wells Fargo Visa — 71 percent
  • Wells Fargo Rewards — 69 percent

For the complete list, click on the CardHub link above.

For help finding the perfect credit card, visit our Solutions Center.

Do you think a credit card with price protection is worth your effort? Share your thoughts in our Forums. It’s a place where you can swap questions and answers on money-related matters, life hacks and ingenious ways to save.

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