Laws to Protect You From Credit Card Fraud
The Federal Fair Credit Billing Act  protects you when somebody misuses your credit card. If you report the misuse or report your card stolen within two business days of finding out about it, you're not liable for any unauthorized charges on your account. But even if you don't bother to report misuse, even after discovering it, your maximum liability is $ 50.
If you are a VISA card user, you're not liable for any unauthorized use. That's because VISA adopted a "zero liability" policy last April. You're not liable for any unauthorized use of your card. With one billion cards out there and e-commerce increasing, VISA doesn't want people worrying about being the victim of credit card fraud. Other credit card issuers may have adopted similar zero-liability policies.
This type of limit on your liability for the most part makes it unnecessary to purchase "loss protection" insurance against unauthorized credit card use. Unless you're really worried about that $ 50 liability possibility, such insurance can be a waste of your money.
In lieu of purchasing the "loss protection" insurance, make sure you look over your billing statements each month for any unfamiliar purchases and contact your credit card company for clarification on their policies. If you notice any purchases on your statement that are not your personal purchases, notify your credit card company immediately. This notification initiates the two days you have to save yourself $ 50 by reporting the unauthorized use. Work closely with your credit card company to keep your card safe and know your responsibilities for fraudulent purchases.
Note: The Federal Fair Credit Billing Act  generally applies to "open end" credit accounts such as credit cards, revolving charge accounts, and overdraft checking accounts. The Fair Credit Billing Act establishes procedures for resolving mistakes on credit billing account statements, including charges not made by consumer, charges that are incorrectly identified or show the wrong amount or date; computational errors; failure to reflect payments or credits properly; not mailing or delivering credit billing statements to the consumer's current address, if the address was received by the creditor in writing at least 20 days before the billing period ended; and charges for which an explanation or documentation is requested to correct possible error. The Federal Fair Credit Billing Act generally does not apply to loans or credit sales that are paid according to a fixed schedule, such as the typical automobile financing.