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Credit card travel and purchase benefits are increasingly important to cardholders in 2024. In part, this is because travel delays and rising costs can make the perks more valuable, but also because cardholders are better informed about what benefits their cards offer. Here's a look at how the most popular and common types of perks work, and how they might change in 2024.
Credit Card Travel Protection Trends in 2024
You typically need to book your trip, lodging or other service with the card that offers these protections to be eligible, or use points from the card's rewards program to pay for the trip. When you do, credit cards' travel purchase and insurance benefits may include:
- Trip accident insurance: This offers coverage for when a traveler is killed or seriously injured during a trip. Serious injuries may include loss of speech, sight, hearing or a limb.
- Trip cancellation and interruption insurance: It may reimburse you if your trip is canceled or cut short due to a covered event, such as covered illnesses or severe weather.
- Trip delay insurance: This can cover expenses, including meals, transportation and lodging, if your planned trip is delayed or canceled.
- Baggage delay insurance: It can reimburse you for necessary purchases, such as clothing and toiletries, while you wait for your bags to arrive.
- Roadside dispatch or assistance: This coverage could either help connect you with nearby roadside help while you're on the road or help cover the cost of certain services.
- Auto rental collision damage waiver: This is primary or secondary coverage for when a rental car is damaged or stolen.
"Credit card issuers look at what consumers are spending their money on and try to address those use cases with benefits and other features," says Peter Alter, vice president at CBSI, which provides benefits services to card issuers.
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Travel Insurance Claims Are Rising
Trip delay and trip cancellation and interruption insurance benefits continue to be a top benefit as more people travel and experience delays.
"The big theme [for 2024] is Covid is in the distant past," says Alter. "All the travel trends and related claims have resumed, and they're surpassing pre-Covid levels."
Alter says benefits claims have risen partially because of airline-caused delays, but also because of systemwide issues, such as long airport security lines. Additionally, severe weather events can lead to delays and cancellations.
In 2023, 76.05% of flights arrived on time, according to the U.S. Bureau of Transportation. About one in five (22.06%) flights were delayed and 1.62% were canceled. Although that's the lowest level of cancellations in over five years, it's the highest level of delays over the past 10 years.
Cardholders Are Increasingly Savvy
Some of the increase in claims can also be attributed to people learning more about their credit cards' benefits.
"There is a large and growing number of savvy credit card travelers," says Alter. "Consumers are increasingly aware of the difference in the coverage details, such as a trip delay coverage that starts at four hours, six hours or 12 hours. Or whether their trip cancellation covers severe weather."
Consider reviewing your credit cards' trip cancellation, delay and interruption coverage details. These could potentially save you a lot of money, and you want to know which card will be best based on the eligibility requirements and benefit amounts.
Travel Benefits Might Become Less Common
You might be concerned that increasing claims could lead to card issuers removing some of these benefits, but that likely won't be the case across the board.
"These travel benefits have the highest level of claims and are, therefore, the most expensive to deliver," says Alter. "I think there will be a differentiated market." The credit cards that want to attract frequent and aspirational travelers might continue offering these benefits, but other cards might strip them away.
Keep this in mind as you compare the top travel credit cards.
Rental Agencies Ask for Proof of Insurance
Credit cards' auto rental collision damage waiver (CDW) benefit can help cover the cost of repairs or a replacement if a car you rent is damaged or stolen.
Some cards offer primary coverage, which means that even if you have auto insurance coverage, the credit card benefit kicks in first. With secondary coverage, you have to file a claim with your insurance company first, if you have insurance.
The big change for 2024 is that rental car agencies are increasingly asking for proof of insurance when you want to rent a car.
"Partially because they want to sell the CDW, and partially because they don't want you to drive a car off a lot without insurance," says Alter. "To make this easier for cardholders, we created a real-time mobile and web-accessed Letter of Eligibility that cardholders can request and show to rental agencies."
You can go to eclaimsline.com and enter your card number, contact information and rental period and immediately receive the Letter of Eligibility.
Credit Card Purchase Protection Trends in 2024
Most credit cards include zero-liability protection for unauthorized purchases, and many offer additional protections on products and services you pay for with your credit card:
- Return protection: Allows you to return a product and get a refund when the original retailer doesn't accept the return.
- Purchase protection (or purchase security): Get reimbursed for products that are damaged, lost or stolen.
- Extended warranties: Extends the manufacturer's warranty on a product.
- Price protection: Can cover the difference between your purchase price and a lower advertised price after you make a purchase.
- Cellphone protection: Reimburses you if your phone is stolen or damaged.
As helpful as these card benefits can be, it's important to remember they all have requirements and limits.
For example, return and purchase protections usually only last a few months from the purchase date, and there may be per-claim and annual limits. Or, the extended warranty benefit may only apply to purchases when the original manufacturer's warranty was for one or two years.
But many of the benefits, even cellphone protection, are available on cards that don't have an annual fee.
Extended Warranties Remain Important
Receiving an extended manufacturer's warranty was always a nice credit card benefit, but it became increasingly important when supply chain shortages made replacing broken items more difficult.
Now, even if companies resolve their supply chain issues, replacement costs may be much higher. "We do see that people are keeping items longer, and we're getting claims that are closer to the end of the warranty period," says Alter. "In years past, people might have bought something new, now we're getting a claim."
Purchase Protection Benefits May Become More Common
Credit card purchase protection can vary, but they generally last 60 to 120 days from the date of purchase.
"Because online shopping is clearly here to stay, I think that's a benefit that you'll see continue and possibly grow," says Alter. Cardholders may even be able to file a claim if someone steals an item they buy from their porch or mailbox.
"We also cover things like an item stolen from the car," says Alter. "That happens frequently, but it's not covered in the news as much."
The Big Picture for 2024: A Focus on the Claims Experience
In past years, we highlighted new types of benefits that were introduced, such as rideshare protection and coronavirus-specific travel protection benefits. That's not the case for 2024.
"There aren't many brand-new benefits for 2024," says Alter. "But there is a focus on helping cardholders understand and take advantage of their benefits."
The electronic Letter of Eligibility for renting a vehicle is one example. You can also file other types of claims on eclaimsline.com, and CBSI developed systems and works with the major travel agencies to make the process easier and faster.
"We can now collect some or all of the documentation on behalf of claimants," Alter says. "We've seen our claims cycle times drop, and the approval rate has increased, so we know those efforts are working."
Find Your Next Credit Card
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