Do you need credit card insurance?

Answer 1

According to the Federal Trade Commission: Don't buy "loss protection" credit card insurance. Telephone scam artists are lying to get people to buy worthless loss protection and credit card insurance programs. If you didn't authorize a charge, don't pay it. Follow your credit card issuer's procedures for disputing charges you haven't authorized. Your liability for unauthorized charges is limited to $50.

The FTC says worthless credit card insurance offers are popular among fraudulent promoters who are trying to exploit consumers' uncertainty. As a result, the agency is cautioning consumers to avoid doing business with callers who claim that:

you are liable for more than $50 in unauthorized charges on your account;

you need credit card insurance because computer hackers can access your account number and charge thousands of dollars to your account;

a computer bug could make it easy for thieves to place unauthorized charges on your account; and

they're from "the security department" and want to activate the protection feature on your account.

The FTC also advises consumers not to give out personal information -- including their account numbers -- over the phone or online unless they are familiar with the business that's asking for it. Scam artists can use your personal information to commit fraud, such as identity theft. That's where someone uses some piece of your personal information, such as your account number, Social Security number, mother's maiden name, or birth date, without your knowledge or permission to commit fraud or theft. An all-too-common example is when an identity thief uses your personal information to open a credit card account in your name.