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Nine "Free" Credit-Card Benefits You Don't Know You Have

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You almost certainly know about the miles or points you get on each credit-card purchase -- presumably, that's why you chose the card or cards you use for travel. And you may know about the collision coverage most cards provide for a rented car. But many cards provide other travel benefits that you might not even know you have.

Rental-Car Collision Coverage

As I said, you probably know about this, but for those who don't, rental-car collision coverage is by far the most important travel benefit your credit card provides. If you rent with a card offering this benefit and the car is damaged during the time you rent, the card picks up whatever costs you can't first recover from your regular insurance. All you have to do is use a qualifying card and decline the rental company's outrageously expensive collision damage waiver (CDW). This benefit is worth big bucks: CDW charges can go as high as $30 per day, sometimes more than the base rental rate. All AmEx, Diners Club, and Visa cards, as well as most Discover cards and many MasterCards offer this feature.

Most card coverage is secondary, meaning it covers only what you can't first recover from your regular automobile insurance. However, all Diners Club cards and a few MasterCards and Visa cards offer primary coverage, which means the card picks up the entire cost and you don't have to claim on your regular policy. AmEx also offers primary coverage for an extra fee.

Common-Carrier Lost Baggage

If you buy an airline, bus, rail, or other "common carrier" ticket with your card and then check baggage, Visa premium cards, most AmEx cards, and quite a few others cover you if the baggage (some cards say "luggage") is permanently lost, stolen, or damaged. Typically, card coverage is secondary, meaning that you must first claim from the carrier. Coverage limits vary: The card may cap collection at a typical figure of $3,000, or the card may provide coverage of a claim that exceeds the carrier's maximum limit. Some cards cover carry-on as well as checked baggage.

The catch here is that payments on most such claims cover only the depreciated value of the items lost or damaged, not the replacement value. Many of you would have a tough time coming up with $3,000 worth of depreciated value for what's in your baggage.

Trip Delay/Baggage Delay

If your trip is delayed, a few premium cards offer a modest amount of coverage toward the cost of meals, accommodations, and various "essential items." Coverage kicks in only after a specified time, typically as long as 18 hours after the delay, and reimbursement may be net of what you can first recover from your carrier. Once quite prevalent, this card benefit is now available only on a few cards.

Roadside Assistance

Visa premium cards, most AmEx cards, and many others offer a somewhat slimmed-down version of the type of roadside assistance you can get from AAA if a car you're driving runs out of gas, suffers a flat, or experiences a dead battery. But if you're in a rental car, call the rental company first.

Accident Insurance

Remember back when many travelers routinely fed a handful of quarters into a machine in the airport lobby to buy a "flight insurance" policy for their trip? Even then, this insurance was a bad buy: It exploited the generally prevalent fear of air crashes. Fast-forward to today, when many credit cards provide up to $500,000 in "accidental death and dismemberment" (ADD) insurance for travel on any common carrier. The chances that you or your estate will actually collect anything are, as the mathematicians say, "vanishingly small." But as long as it's "free," you don't really care.

Trip-Cancellation/Interruption Insurance

Credit cards may provide a low-value trip-cancellation/interruption (TCI) benefit. The benefit is similar to conventional TCI, but when the coverage is "free," the dollar limit is low. Only a few premium cards provide this benefit "free," including Capital One World MasterCard, Chase Sapphire card, and several premium Citi cards.

Quite a few card issuers offer to sell conventional TCI policies at generally competitive prices. But that's a convenience, not a benefit.

Airport-Lounge Entry

A few premium airline co-branded cards include entry into the sponsoring airline's lounge clubs and those of its alliance partners. AmEx Platinum cards include entry into several airline as well as non-airline lounge programs. Where available, this benefit is worth big bucks. Although card-based entry privileges may be a bit below those of full members, you pay less for them. Regular memberships in big-airline programs cost around $500 per year, so even with the AmEx Platinum card's annual fees of around $450, entry privileges can actually cost less than regular membership.

Concierge Services

A few premium cards provide arrangements with local agencies that fill the function of a good concierge in major cities: They can arrange sightseeing, tickets to local entertainment, tables at famous restaurants, and such. Some years ago, a credit-card concierge program scored tickets for my wife and me to a supposedly "sold out" Vienna Opera production. Although the service is "free," you obviously have to pay for whatever the concierge arranges.

Referral Services

Many credit cards provide referrals to medical and legal services wherever you are. Also, some cards facilitate local replacement if you lose prescription drugs. As with any concierge, all you get "free" is the referral; you have to pay for the services you use.

Choosing a Card

If you travel at all frequently, it makes sense to use a credit card with a broad range of travel benefits. Start by checking the features and possible upgrade options of the cards you already use. If your current cards come up short, visit a credit-card comparison website such as LowCards (I'm indebted to LowCards' Bill Hardekopf for bringing some of these ideas to my attention).

Unfortunately, with the general exception of rental-car collision coverage, neither LowCards nor its main competitors tabulate these other benefits in detail. You can, however, compare the benefits of all AmEx cards on the American Express website and all Visa cards on Visa's comparison website. MasterCard's benefits are not as consistent as Visa's, so you have to check each card individually. Discover includes only collision and accident insurance, and overseas acceptance is limited.

-- By Ed Perkins

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