Here’s why you need a Credit Card Insurance

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It is magnificent how credit cards and digital payments have transformed the way people tend to make payments in today’s era. Most of the credit cards get attention and popularity in the mainstream market either because of the rewards or welcome bonuses. However, with the increasing competition in the UAE market credit card companies have a lot more to offer apart from welcome bonuses and cashback schemes.  

If you are stuck in the dilemma and are unable to decide whether you should get a credit card or not, reward programs, cashback schemes, rate of interest, annual fee, and welcome bonus would be some of the best things that would cross your mind at first. You might not be planning to use your credit card regularly, it’s the credit card insurance that makes a difference in the end.  

Credit card insurance is also known as payment protection insurance helps credit cardholders to pay their outstanding balance in case of any unforeseen events that interrupt the repayment process. If you want to make the most of your credit card it is essential to be aware of the benefits offered by credit card insurance. In order to make sure that you make the most out of your credit card, in this blog, we will shed light on credit card insurance. Furthermore, we will explain the features and benefits of credit card insurance in the UAE. 

What do Credit Card Insurances Cover?

The primary array of benefits offered by credit card insurances usually vary from provider to provider, but aids usually include coverage for critical illnesses, disability, loss of employment, and accidental death coverage. There are numerous credit card insurance plans that are designed and developed considering a specific segment of clients i.e. student, family, and spouse of the primary cardholders.  

The maximum amount of coverage offered by credit card insurance plans varies on the basis of the credit card that you have. With the right credit card insurance in UAE, one can minimize the burden of making the repayments to the credit card provider. Credit card insurance manages the repayment of outstanding financial obligations in case of an event that leads to the disability/demise or loss of employment of the policyholder.  

Is Credit Card Insurance Worth Buying?

If you already have an insurance plan in places such as term insurance, the whole of life insurance, health insurance, car insurance or critical illness insurance you might not essentially need a credit card insurance in UAE. Contrary to the first situation if you don’t have enough funds to make the repayment of your outstanding credit card bills as a result of a reduction in income or unforeseen events then credit card insurance might turn out to be a savior for you. 

Benefits and Aids offered by Credit Card Insurance

There are various benefits that are offered by credit card insurance, here’s a quick rundown-

  • With the number of rising vehicles on the street, there has been an exponential increase in the number of road accidents. In order to safeguard your loved ones against the financial burden of repaying your outstanding credit card debts, credit card insurance waives off the due amount up to AED 10,000. An important point to be kept in consideration is that the amount that is waived off by the credit card companies typically varies from provider to provider. 
  • In order to understand another benefit offered by credit card insurance, let us consider an exemplary situation. Suppose you have rented a car and you chose not making the payment for the insurance that is offered by the car rental company. Later, your rented car was damaged due to a minor accident. Instead of making the payment for the repair from your pocket, you can choose to make the payment via rental car insurance that if offered without any cost when you pay the rent using your credit card. 
  • A lot of credit card companies offer personal accidental coverage that protects the buyers by providing a claim that can be used to cover the expenses of medical treatment. 
  • None of us likes to cancel trips but at times there are umpteen reasons that result in cancellation of pre-planned trips. Some of the most common reasons are sudden illness, family problems, accidents, etc. and this is where credit card insurance saves a lot of your money. In case you’ve booked your tickets using a credit card then canceling tickets will help you to claim the losses even if the tickets were non-refundable. 
  • Purchase protection is one of the popular benefits offered under the umbrella of features offered by credit card companies. Using this feature cardholders can claim returns in case their purchase is stolen or damaged. The coverage offered varies from provider to provider and the protection period is 180 days from the day of purchase.  

In a Nutshell

With different types of credit cards, there are different types of credit card insurance that are offered to customers. If you are getting a new credit card make sure you get yourself the right credit card insurance plan that will protect you against unforeseen events. 


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