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Money Minute: 5 credit card perks you never knew you had

Your credit card is good for a lot more than paying bills and racking up miles. Here are five little-known perks you never knew you had. 

Lost baggage protection. If you book a flight using a credit card, you may be covered for up to a few thousand dollars if the airline loses your bags. Even if your baggage is only delayed a day or two, you’re probably covered as well. Some credit cards will reimburse you for a few day’s worth of clothing and toiletries. For example, the Chase Sapphire Preferred card covers up to $100 per day for five days when baggage is delayed more than six hours. Just be wary of annual fees these cards may charge. The Sapphire card gives you one year fee-free but charges $95 thereafter.

Refunds and returns. If you want to return something but the company won’t take it back, your credit card company might refund you. The same perk applies if you were wrongfully charged by a merchant and they refuse to refund you. Again, for this to work you have to make the original purchase with your credit card. Some card issuers, like Discover, even cover you if your item was stolen within 90 days of purchase. This is yet another reason it’s smart to buy expensive items on credit, rather than debit.

Extended warranties. Let’s say your brand new big-screen TV or washing machine dies on you just a few months after your warranty is up. If you purchased it with a credit card that has extended warranty coverage, your issuer may offer to replace it, fix it or reimburse you for its value. The limits on reimbursements vary from card to card so check with your company. In a recent study by CardHub, American Express and Visa ranked highest for extended warranty policies.

Trip cancellation. If you have to a cancel a nonrefundable trip due to illness or weather, your credit card may offer trip cancellation protection. Some cards offer to cover up to $10,000 of flight, hotel and transportation fees. Just read the fine print carefully. Almost every card has a different policy, and, again, some cards charge annual fees. The Citi Double Cash Card has no annual fee and offers up to $1,500 worth of trip protection. The United MileagePlus Club card offers a whopping $10,000 worth of trip cancellation protection but comes with a hefty $450 annual fee.

Rental insurance. Just about every major credit card issuer offers some form of car rental insurance, which is a great alternative to purchasing supplemental insurance from a car rental agency. Rental policies may change depending on which state you’re in, so definitely call up your credit issuer to ask before you assume you are covered. Nerdwallet closely tracks cards with the best rental insurance offers and ranks Visa, MasterCard, American Express and Discover at the top of the list.

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