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American Express Rolls Out Premium Return Protection for All Cards

Nov. 15, 2010
Credit Cards
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A new service from American Express, Premium Return Protection, seems like a great fit for impulse buyers everywhere.  If you’ve ever overshot the dreaded “Must return within 30 days” deadline, this program could bail you out to the tune of $600 per incident, whether you are buying jewelry, clothing, electronics, DVDs, or software.

With premium protection, you have up to 180 days to return an item instead of the 30 or less that stores often give you. The coverage is good for $600 per incident, and up to $2,500 per year. This compares favorably to the return protection offered on many American Express cards that protects you for 90 days to the tune of $300 per incident and $1,000 per year.

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The protection goes above and beyond standard Amex return protection in another way as well – restocking fees. I recently purchased a Macbook Air, opened it, and discovered within 24 hours that a new version was being released the following week. Apple charges a 10% restocking fee for open Macs, which is non-trivial on a $1,500 computer. But American Express Premium Protection would have had my back and covered that $150 as well.

“We believe we offer the only return protection program that covers restocking fees,” says Leah Gerstner, a spokesperson for American Express.

In fact, you also don’t have to be an American Express card member to sign up for Purchase Protection. For $49.99 (their annual fee for the service), American Express says it “will cover purchases made in the United States with any credit, debit or charge card from any financial services company.”

They also cover shipping up to $20 per purchase and up to $100 a year. This is great for those of us who love shopping online, but don’t love the amount it costs to buy something, return it when it doesn’t fit, then buy the new size again.

Of course, there is fine print to be aware of. You need to make sure to send a photocopy of your receipt, for example. And any item you’re thinking about returning has to be new(ish), as in clothes must still have the original tags and technology like DVDs and computer software need to be in the original packaging. Open electronics items are acceptable, as long as they are in good working order.

A Few Things To Consider Before Signing Up

Clearly, American Express is in the business of making money. You can bet that on average, they will end up refunding less than $49.99 per signup.  To take things a step further, American Express actuaries know full well that the typical person who signs up for this policy will likely be the indecisive impulse shopper set.

It is important to do a through self assessment before jumping feet first into a $49.99 annual insurance policy, by asking yourself the following question – how is it possible that they are making money on the program?

While American Express has some great resale relationships that allow them to offer you this protection at a reasonable price, we believe that you are also a bit less likely to use this product than you may initially think.

For starters, American Express’s contract points to the return policy of the store as a first line of defense. Most of the time, you’ll decide to return your non-fitting item of clothing, with tags attached, before the merchant’s return policy runs out. It’s a heck of a lot easier than dealing with mailing items around and faxing receipts.

It’s also unlikely that you’ll leave a DVD or software box wrapped and unused for more than 30 days, before deciding to return it.  Opening such items disqualifies them from premium return protection.

And while American Express covers items like home décor, small appliances, and exercise equipment – their maximum mail reimbursement is $20 per incident, so extremely heavy items with low monetary value probably aren’t going to ever be worth returning. Think dumb bells, treadmills, certain appliances, etc.

Furthermore, American Express cardholders already receive 90 days of protection at $300 an incident, so the additional coverage may be superfluous in most cases.

There’s also the element of laziness. Those who have the disposable income to buy frivolous $100 items online may not be willing to bother with submitting paperwork to get a refund.

A Great Deal For Many Indecisive Shoppers Out There

The bottom line? If you often find yourself feeling dissatisfied with your purchases, frequently shop online, or have a closet full of clothes with tags attached, this might be a worthwhile program. If, however, you’re usually a happy camper with your stuff, then save your fifty bucks. For more information on the American Express Premium Return protection service, you can go online at or give them a call at 1-866-912-6566.