Insurance Insurance: How does credit card extended warranty insurance work?

To the point Most credit cards in Canada offer extended warranty insurance. Find out how it works and what's covered!

The extended warranty offered by your credit card The Principle Restrictions

The best credit cards for extended warranty Credit cards with no annual fee Credit cards with annual fees

Quite often, when you buy an item of a certain value in a store, despite its legal warrantywe’ll try to sell you an insurance policy that offers extended product warranty. This often costs between 10% and 30% of the total value, which can add to your bill!

Yet most credit cards in Canada come with an extended warranty. Even some credit cards with no annual fee!

Technically, we are protected by the Legal Guarantee as outlined by the Office for Consumer Protection (OPC). However, it can be difficult to claim it from the manufacturer and often it will be quicker to deal with your credit card insurance.

The extended warranty offered by your credit card

The Principle

The Extended Warranty Insurance on your credit card requires that you pay for your purchase in full on the credit card (or with the card’s reward points). This may include the majority of movable property. But as you will see below, restrictions may apply.

During the first year (or even the first two years in some cases), you are normally covered by the manufacturer’s insurance. Extended Warranty Insurance will then activate as soon as the manufacturer’s insurance coverage ends.

This warranty will generally be for an additional year, or even two years for some credit cards.

Of course, if you wish to benefit from the extended warranty, your credit card must still be active at the time of the claim.

So think twice before you cancel your credit card! This is where it can be interesting to have a credit card with no annual fee on which you charge items to eventually benefit from the extended warranty!

Restrictions

As with any insurance contract, you must be careful about the various restrictions:

The maximum amount covered (per product, per year or even per entire term of the card account)
Products excluded from the Extended Warranty (certain electronic products, heating or air conditioning equipment, etc.)

But usually, big appliances are covered!

It is therefore your responsibility to check the insurance contract for each of your credit cards before proceeding with the purchase.

The best credit cards for extended warranty

Credit cards with no annual fee

Here is our selection of credit cards with no annual fee and extended warranty:

All of these cards offer an extra year for most new purchases made anywhere in the world (up to a lifetime maximum of up to $60,000).

If we were to choose only one of these credit cards with no annual fee, it would be the Scotiabank American Express Card.

The Scotiabank American Express Card Extended Warranty Insurance does not have exclusions, such as electronics. Here’s what’s in their insurance policy:

Items Not Covered – Extended Warranty does not cover the following items: aircraft and parts and accessories thereof; automobiles, motorboats, motorcycles and any other motorized vehicles and parts and accessories thereof; used items; living plants; trim parts; services; items purchased by and/or used for a business or commercial purpose and commercial gain; dealer and assembler warranties; or any other obligation other than those specifically covered under the terms of the original Manufacturer’s Warranty.
Carte American Express de la Banque Scotia

In addition, it is one of the only credit cards with no annual fee in Canada to offer as well:

Purchase Insurance (up to 90 days)
Price protection (in the event of a price drop up to 60 days after purchase)
Travel Medical Insurance (up to 8 days for those under age 65 and 3 days for those over age 65)
Trip Interruption Insurance
Collision/Loss Damage Insurance for Rental Vehicles
Travel Accident Insurance (up to $500,000 per trip)

For more information on this card or to apply for it, please click here!

Credit cards with annual fees

All credit cards with an annual fee offer the extended warranty. However, some of them are better, particularly in terms of the duration of coverage.

Here is our selection of credit cards with annual fees that offer extended warranty:

All of these cards offer an extra year for most new purchases made anywhere in the world (up to a lifetime maximum of up to $50-60,000).

If we had to choose only one of the credit cards with an annual fee, it would be National Bank’s World Elite Mastercard.

Indeed, to our knowledge, it is the only credit card to “triple” the extended warranty. Here’s what’s in their insurance policy:

Extended Warranties – Triples the warranty period for new items covered by an original manufacturer’s warranty valid in Canada. The warranty can be extended for a maximum of 2 years after the end of the original manufacturer’s warranty. If the original warranty is longer than 5 years, the cardholder must contact the insurer to register the purchase.
Carte World Elite Mastercard de la Banque Nationale

In addition, it is one of the only credit cards in Canada to offer 180 days of purchase insurance (compared to 90 days for most credit cards ).

The insurance this card offers is detailed here. Here are all the insurances included:

Purchase Insurance (up to 180 days)
Trip Cancellation Insurance
Trip Interruption Insurance
Out-of-province hospital insurance
Flight delay insurance
Baggage delay insurance
Theft or loss of luggage insurance
Car rental insurance
Medical, general and legal assistance

Beyond insurance, it is the only credit card in Canada to offer a credit of up to $250 per year on seat selection, airport parking and baggage charges. This puts the cost of the annual membership fee into perspective!

For more information on this card or to apply for it, please click here!

Bottom line

Paying with a credit card allows you to benefit from many things, such as the extended warranty! Keep that in mind when you shop for your next credit card and check out the best current offers!

As you can see, there is no shortage of options, both for credit cards that have annual fees and those that don’t!

Credit cards insurance