If you’ve ever bought something and then saw the price drop a month later, the feeling that you’ve been gipped a little bit is hard to shake. The $1,200 couch you bought is now $1,000, and maybe the retailer will give you a $200 refund. Maybe not.
Your credit card may be able to help. Some credit cards offer price protection. So if you bought that couch with a Chase Sapphire Reserve Visa card, it would reimburse you for the price difference if you saw a lower price advertised within 90 days of the original purchase.
No more. The two largest credit card issuers in the U.S. are either getting rid of of cutting back their price protection benefits.
Chase is eliminating that benefit on Aug. 26, 2018. It had offered coverage of up to $500 per item, up to $2,500 per year per cardmember.
Citigroup said in April that starting July 29 it would cap refunds through its Citi Price Rewind program at $1,000 annually per customer and $200 per claim. They were $2,500 annually and $500 per claim.
Some credit cards allow an unlimited number of claims per year, but cap the total amount. Others limit the number of claims that can be submitted in a year. Jewelry, used goods and perishables are often excluded. To be eligible for reimbursement, customers typically had 30 to 120 days from purchase to file a claim.
Why benefits are leaving
Price protection benefits are dropping or being eliminated for the simple reason that credit card companies are losing money on them because more consumers are filing claims.
The claims used to be cumbersome to file. You had to monitor prices, file a claim and send in receipts and advertisements, maybe follow up, and wait to collect a check in the mail.
All of that can now be done online or through a bot such as Earny and Sift. The apps look at receipts in your email and searches for price drops on your purchases. It claims the difference on your behalf and takes a 25 percent cut of whatever it recoups.
Business Insider reported that Citi made more than 575,000 Price Rewind payments in 2017 that totaled $18.7 million in refunds.
Filing a claim through a bot is easy enough, but the claims can be expensive for banks to process, especially if they’re for a refund of 50 cents or so. Assessing a claim and the supporting documentation isn’t automated yet, and is a process outsourced by credit card issuers.
Discover still offers price protection
Earny works with Chase and Citi credit cards, but not with Discover, and American Express doesn’t offer any price protections.
Discover has cut some of its card benefits, including car-rental insurance, flight-accident coverage and extended-product warranty. But it hasn’t changed its price protection benefit, and still offers unlimited claims per year up to $500 per claim and $2,500 per year. Customers have 90 days after a purchase to file a claim.
One reason Discover doesn’t work with the Earny app, and why it may not be changing its price protection policy, is that it requires cardholders to call to initiate a claim. A claim form and supporting evidence are then submitted online or through the mail. It’s not as streamlined as Chase and Citi’s, but Discover’s process doesn’t allow the bot work with it.
The good news for consumers is that 87 percent of all cards that offer price protection do work with Earny. If you download the app and have a Discover or American Express card, the app informs you which supported credit cards have the best price protection policies.
What consumers can do
If your credit card still has a price protection service, use it with a bot or check prices yourself. If something breaks that you bought with a credit card, some still allow refunds.
You can also sign up for price alerts through the store’s app, or create a Google alert with the name of the store, name of the item you bought and price, to get an email when prices change. You can then go back to the store and ask to be reimbursed the difference, which should be granted within 30 days, though you may be able to negotiate for longer.
Unless you have a lot of time on your hands, filing a claim or going back to a store can be a lot of work for a little amount of money. You may be best off just doing this for large ticket items such as a new refrigerator or couch.
If your price adjustment request is outside the 30 day window that most retailers offer, you can get around that by returning the item for a full refund and then buying it again at the lower price. Explain to a customer service representative that you’re doing this, and they may give you the difference make to save both sides some hassle.
Some stores, however, may have a short return policy. Costco has a liberal return policy — 90 days for electronics and up to one year for most everything else.
Price protection benefits are slowly falling off the list of credit card benefits, but that doesn’t mean consumers can’t stop looking for price drops themselves and seeking the difference back in other ways.