Most credit card users either didn’t know or didn’t use them, but this under-the-radar benefit can help consumers save hundreds of dollars on purchases.
Price protection helps cardholders take advantage of price decreases on their recent purchases. For example, you buy a $500 television with your Chase Sapphire Preferred card. A month later, you find that Best Buy is offering the same television for $400.
That price disparity allows you to submit a price protection claim form and provide supporting documentation, including receipts and an advertisement with the lower price, to get the price match and a $100 refund. Yes, the process can be cumbersome and most people don’t do the research. Plus there are claim caps, purchase coverage time-frames and other limitations.
Several credit card companies, including Chase and Citi, are now reducing or removing price protection benefits from their cards. Why would they do this if most people never took advantage of the perk in the first place?
The answer: The trend has reversed and more cardholders then ever are using the price protection benefit.
A couple of years ago, tech companies such as Earny and Sift began automatically filing price-protection claims with credit-card issuers on behalf of customers, who grant the bots access to their email to scan for purchases and receipts, according to Business Insider. These apps made the cumbersome process much easier for consumers and more of them started to seek refunds on price drops.
Since the introduction of these applications, there has been an eruption in the number of claims made to credit-card companies. And that “hidden perk” is now costing the credit card companies more than ever.
In August, Chase is doing away with price protection altogether as one of several changes to the Sapphire Reserve, says Business Insider. Citi says it would cap refunds from its Citi Price Rewind feature at $1,000 annually per customer and $200 per claim, starting July 29. Those caps were previously $2,500 annually and $500 per claim.
Read Business Insider’s overview of this trend.