Credit Card Insurance

Definition - What does Credit Card Insurance mean?

Credit card insurance refers to coverage for loss or damage associated with the use of a credit card. Coverage might be a standard feature of the credit card account, may be included as a credit card feature upon the card holder's request, or it may be bought as an independent policy.

Insuranceopedia explains Credit Card Insurance

Like any other insurable item, there is a variety of coverage options when it comes to insuring a credit card. But credit card holders should know that they may already have insurance features bundled with their credit card account. Most credit cards have the following:

1. Protection against illegal purchases made by someone else. The card owner is the only person allowed to make a purchase using the card. If someone uses it without the card owner's knowledge, a security feature of the credit card (and also a notification from the credit card company) might cancel their purchases.

2. Partial reimbursement of lost baggage. Credit card providers often partner with airlines and travel companies, which allows them to provide aid and relief in the event of a travel mishap, like lost or damaged baggage, by partially reimbursing the credit card owner.

Coverage might be extended by the card holder's request or by buying a separate policy. Coverage can include payment for credit card bills when the owner is unemployed or is incapable of finding income-generating work.

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