What is credit card price protection and how does it work?

Quick insights

• Credit card price protection is a complimentary benefit that could refund you the price difference when a purchased item is later made available at a lower price.
• This credit card benefit is different from another one with a similar name, purchase protection.
• Note that Chase does not currently offer price protection. 

You probably know of stores that offer price adjustments, but did you know that some credit cards refund you the difference when the price drops too? This credit card benefit can help you save money and may be especially beneficial for large purchases.

Here's what you need to know about credit cards with price protection.

What is credit card price protection?

Credit card price protection refunds the price difference in eligible situations when you can show that the price of an item decreased after you purchased it. Usually there's a set timeframe after you buy the item in which you're covered for any price drops. The lower price doesn't have to be offered by the same retailer from whom you made the original purchase.

It can be time-consuming to track price drops for every item you purchase, but it may be worth your time to do this for major purchases.

It's offered as a complimentary benefit on some credit cards, and it's one of many factors to consider as you weigh the pros and cons of a credit card. Currently, Chase credit cards do not come with a price protection benefit.

The difference between price protection and purchase protection

You may be aware that some rewards credit cards offer "purchase protection," which is different from price protection. Purchase protection is another complimentary credit card benefit that provides protection for damage and theft when you purchase eligible items with your credit card. Price protection refunds you the difference when the price of an eligible item drops.

How price protection works with a credit card

If you want to utilize this credit card benefit, you'll usually need to file a claim and provide documentation. Generally, the documentation needs to demonstrate that you purchased the item with your credit card with price drop protection and that the price dropped. Here's some of the documentation you may need to provide:

• Credit card statement that shows what you paid for the item
• Itemized sales receipt or e-receipt
• Evidence of new, lower price (print advertisement, sales flyer, screenshot of price on product page in online store)

There are certain limitations on the policy. Typically, price drops are only eligible within a certain period of time after you buy the item, often within 30 to 90 days, and you'll need to file the claim in a timely manner. Your credit card's policy may place limits on how much can be refunded per item, as well as the total number of refunds per year.

Additionally, sometimes certain types of purchases are excluded. Some policies exclude internet auctions, closeouts, liquidation and going-out-of-business sales.

In summary

Credit card price protection may refund you the difference when the price of a purchased item drops. You will usually need to file a claim and submit the appropriate documentation in order to get a refund.