Moolr.co.uk | Short term loans

Protections Within Your Credit Card

Your credit card comes with built-in insurance that protects you while making specific purchases. Not everyone is aware of this fact. When you spend more than £100, the insurance kicks in. Thus, you are legally protected. So don’t worry if you receive a damaged item, one that isn’t as advertised, or anything that never arrives. The insurance covers you. Let’s take a closer look at the protections within your credit card.

Protections Within Your Credit Card – Why The Protections Exist

So, why do cards provide such security? Is credit card fraud protection very useful? Basically, card issuers provide it for one reason only. Because the law requires them to do so. Namely the Consumer Credit Act. Credit cards must give protection for purchases over £100 but less than £30,000 under Section 75 of this Act. This protection increases from £30,000 to £60,260 under the Consumer Credit Directive.
Importantly, debit cards do not provide similar protection. This is one reason why using your credit card instead of your debit card can be a good option.

Protection On Purchases

Some credit cards include extra security features that debit cardholders do not have access to. Many (but not all) credit cards offer purchase protection. This means that if you make a purchase with your card and it is stolen or lost within a certain time frame (typically three months), the credit card issuer will reimburse you.
Always examine your card’s terms and conditions to see if such protection applies to you. Only proceed if happy with the terms the lender offers. Shop around if not, or avoid a card altogether.

Additional Protections

A few additional cards, though not all, provide free identity theft protection. This feature protects you from someone taking your identity and racking up credit card debts in your name. This type of coverage usually includes a couple of free credit checks every year. So you can see if anything strange is showing up on your credit record.

Protections Within Your Credit Card – Infamous PPI Policies

Another sort of protection that has been making headlines for some time is payment protection insurance, or PPI as it is more often known. This has been sold alongside cards offering to cover your repayments if you are unable to do so. Such as if you lose your work, for some time.

Unfortunately, many PPI policies were mis-sold in the past to people who wouldn’t be eligible to claim, so they were paying for nothing – for example, because they had pre-existing medical conditions or were self-employed – and as a result, the industry has gotten a lot of bad press, and a lot of claims have been processed since this became widely known.

Peace Of Mind

However, if you know exactly what you’re getting into and the fees, this type of insurance can be a lifesaver if your income suddenly stops due to illness or redundancy, and you don’t have a partner who can cover your bills while you can’t. Do not think that PPI is always a bad thing; it may be appropriate for certain people. Check the terms, do your homework, and make sure that if you do purchase this insurance, you will be able to make a claim if necessary, and that you will not be wasting your money.

  No Obligation Application