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Credit card disability coverage has many pros and cons. For one, it’s designed to offer credit protection for customers who become disabled. This includes personal or on-the-job accidents, as well as job loss and layoffs. In the event customers become disabled, credit card disability protection also covers monthly payments, interest rates, and even finance charges. Credit card disability programs, however, require monthly payments to secure coverage. This is in addition to your existing balance, which can be automatically billed to your card. Like regular monthly payments, disability coverage payments must be made in a timely manner. Any late payments or delays may result in termination of coverage. This, of course, depends on your specific credit card processing plan.

While credit card disability coverage is widely utilized, there are certain restrictions that have been deemed unfavorable by customers over the years. In fact, they have even filed lawsuits against their respective credit card companies, citing lack of coverage in times of need. One of the most common complaints has been the credit card processing time it takes for coverage to kick in. Some customers have stated that despite paying monthly premiums, the credit card companies have found numerous reasons to delay coverage. Without activation of immediate coverage, credit card debts continue to surmount for most customers. This includes additional finance charges, along with high APR rates and interest fees. Most customers feel this is another way for credit card companies to make more money.

There are even certain restrictions on disability coverage that has been activated. For example, a lost or stolen credit card still requires a customer to pay up to $50 of the balance. This is especially true if the thief has run up a big bill on the lost or stolen card. Customers, however, are not aware that they are protected in certain instances. Federal law protects credit card users from criminal activity, even if the credit card company demands a payment. Therefore, disability coverage is not extended to lost or stolen cards. In order to seek remedies, customers have to contact the local authorities and file a claim. This claim will be reported to the credit card company, in the hope that all expenses will be covered. Furthermore, willfully handing your credit card to someone who misuses it also does not fall under disability coverage.

There are, however, some credit card disability programs that do not require monthly payments. Instead, customers have an option to pay quarterly or every six months. This makes it easier for credit card processing, since lump sum payments are directly deposited into your disability account. While disability coverage can help, it simply depends on the needs of individual customers.