7 Hidden Exceptions to Zero Liability Purchase Policies

Estimated read time: 2 minutes

Many major credit card companies offer zero liability purchase policies to their customers. Zero liability purchase policies protect against fraudulent purchases made on your account. This protection means that you would not have to pay a dime in the event of fraud on your account.

However, there have been instances where people thought they were covered only to discover that was not the case. We have compiled seven hidden exceptions to zero liability purchase policies to ensure that you will not be in for any surprises if your account is compromised.

  1. You waited too long

    If you wait two billing cycles to report your credit card lost or stolen, you could be liable for up to $50 in charges. To prevent this happening to you, monitor your accounts and report any potential issues as soon as possible to your issuer.

  2. You are behind on payments

    Typically, your account must be in good standing to be eligible for zero liability protection. To remain in good standing, you must be making the minimum payment each month and by the due date. However, the Fair Credit Billing Act limits your liability to $50 regardless of account standing.

  3. You did not exercise ‘reasonable care'

    Having zero liability protection does not mean you can be careless. To stay eligible, you must treat your credit card as if you would be liable for any fraud. If your card issuer can prove that you did not exercise reasonable care, you may need to pay out-of-pocket for fraudulent charges.

  4. You refused to file a police report

    If your issuer tells you to submit a police report, you have to do it. However, filing a police report can be a conflicting situation if the fraudulent charges involve a family member. If you are unwilling to file a report, you will need to cover the charges.

  5. You used something other than a personal credit card

    Your issuer may not extend the same protection to your corporate credit card. The same applies to purchasing cards, which are corporate cards given to a company's frequent buyers. Bottom line – if it is not your personal card – you may be liable.

  6. You used a foreign credit card

    You are not eligible for zero liability protection simply because your issuer offers it in the United States. In other words, if you have a Visa card issued outside of the United States, it may not be eligible for the same protection as one issued domestically.

  7. You are the perpetrator

    If you are the perpetrator, you will be liable for all of your purchases. This may seem apparent, but you would be shocked at what people have attempted!

Generally, if you take an active role in monitoring your account, you will be eligible for zero liability protection. But keep in mind that zero liability purchase policies are not there to enable you to be careless with your account.