There's an important distinction between the "insurance" you can purchase from a shipping carrier and the purchase protection you get automatically from your credit card. Shipping insurance provides a cash payout if your order arrives damaged, and it's especially useful if you're purchasing one-of-a-kind items on auction sites or from custom manufacturers.

However, it's far more likely that you'll need to take advantage of your credit card's purchase protection option, which can help you in two different scenarios.

In your example, let's say that the jewelry you purchased just never shows up. There's no shipment tracking information, or no evidence that the package arrived at your doorstep. If the retailer doesn't take the appropriate steps to replace your order or cancel your original purchase, call your credit card company to dispute the transaction. Many credit card issuers will log your dispute over the phone, then direct you to an online form that you can complete with additional information. It's a surprisingly painless process with most banks.

When that happens, the retailer gets a charge-back notice from their merchant processing bank. Too many charge-backs within a short period of time can result in either a forced security deposit against future transactions, or even a suspension of their merchant privileges. Obviously, most merchants will want to resolve the issue as fast as possible. In most cases, the merchant will either expedite a replacement product or void the transaction so it won't count against them.

In our second scenario, let's assume that the vendor has received "proof of delivery" from a shipping carrier that your package was left (perhaps unattended) at your home or office. Again, you'd dispute the charge, but you might get the proof of delivery back with a report that your dispute has been processed. If that happens, you don't have to settle for "no." You can escalate your dispute to either the purchase protection or fraud specialists at your bank, depending on your card's specific policies. Even if your card doesn't specifically give you "purchase protection," you'll often get a satisfactory result.

The best part about using your credit card for making online purchases: you never put your own cash at risk. While your issuer investigates your dispute, the purchase price doesn't count against your balance or rack up finance charges. Some banks offer similar protections for prepaid card or debit card customers, but disputed amounts almost always sit in limbo unless a customer service agent issues a "provisional credit" to your account.

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