Exclusive premium credit card perks

There really is no end to the extras that come with premium credit cards. Each credit card issuer in Canada offers something a little bit different to appeal to their clients. Overall, however, there are some standard premium perks that you’ll find on many of the top credit cards.

1. Insurance

While basic no-fee cards in Canada often come with free extended warranty and purchase protection, premium cards can feature ten or more different kinds of complimentary insurance. Comprehensive insurance packages often contain travel insurance like medical, trip interruption or cancellation, lost and delayed baggage, rental car coverage, hotel burglary insurance, and more. Recently, some premium cards have even started to include mobile phone insurance. These kinds of insurance benefits tend to be especially appealing to frequent travellers, yet these insurance extras still have value and can save you hundreds of dollars a year even if you travel only once or twice annually.

Be aware, however, that not all premium credit card insurance benefits are created equal. A big thing to look out for is how long you are actually covered for (some cards offer coverage for as little as 10 days, while some offer up to 60 days of insurance protection). Note also that many premium cards may offer as little as three days or even no travel medical insurance for those who are 65 or over.

2. Airport lounge access

Another highly coveted perk (especially for those who travel frequently) is airport lounge access. Some premium cards include a membership to an airport lounge program, like Priority Pass or LoungeKey, but may not actually provide any free passes. If you spend a lot of time in airports, look for a premium card that actually includes some free visits (otherwise you’ll be shelling out cash every time you want to use a lounge). Access to a lounge can really elevate your airport experience as most include free food, alcohol, comfortable seating (some even have napping areas), spas, and shower facilities.

3. Concierge service

Almost all premium cards in Canada come with a concierge service. This benefit gives cardholders access to 24/7 assistance from a professional concierge who can do a range of tasks like make restaurant reservations, secure hard to get tickets to a concert, offer advice on what attractions to see in a given city or even offer help close to home (like helping to find an emergency plumber in their area). Having good concierge service is like having your very own personal assistant.

4. Hotel extras and discounts

Most premium cards will offer some kind of hotel-related deals. Visa Infinite affiliated premium cards, for example, come with things like free breakfast, late checkout, and room upgrades at eligible hotels. Other perks might include hotel room discounts, a free night, or spa or restaurant credits.

5. Exclusive experiences and entertainment access

Entertainment, special exclusive offers, and member-only experiences really run the gamut, so be sure to do some research into your specific credit card offerings. Generally speaking, most premium credit cards feature access to one-of-a-kind experiences like special chef-lead, invite-only dining experiences, curated wine tastings at select wineries, special seating at sport or concert events, early-bird ticket purchases to theatre shows and concerts and more.

6. Accelerated earn rates

Amped-up earn rates are another common premium card benefit. While a non-premium, no-fee cash back credit card might earn you as much as 2% on groceries, restaurants or recurring payments, a premium card could earn you as much as 4% cash back for the very same categories. Likewise, instead of getting 1 or 2 reward points or miles per $1 spent on a regular reward card, you could earn as many as 5 points for every $1 you spend in a given category with a premium card. Those extra points and cash back can really increase your earning power and more than compensate for the cost of a premium card’s annual fee.

Additional perks

Other less common but equally valuable premium perks really depend on your specific credit card provider. Additional perks you might get include:

  • No foreign exchange fee: This relatively rare perk among premium Canadian credit cards is a real boon for anyone who often travels outside of Canada or who makes online purchases in a foreign currency. With this perk, you won’t be charged the usual extra 2.5% foreign currency conversion fee most credit cards charge for non-Canadian purchases
  • Discounts on golf fees and merchandise at select golf courses
  • A handful of premium credit cards offer NEXUS rebates, for when you travel.
  • Premium credit cards affiliated with airlines or airline loyalty programs may offer free checked bags and free companion passes
  • Rental car discounts

Who can apply for a premium card?

The majority of premium credit cards in Canada have a higher annual income requirement than basic credit cards. Individual income requirements generally range from $60,000 to $80,000 or a household income of $100,000 to $150,000.

That being said, American Express doesn’t list a minimum income requirement for many of its premium cards. You can expect that American Express will take an applicant’s credit score into consideration despite not having an income requirement. To apply for a premium credit card in Canada, you’ll likely need at least a “good” credit score of 690 or above. Of course, it never hurts to contact a credit card provider to confirm its requirements before applying if you’re uncertain.

Who should get it and who should stay away?

Premium credit cards are not for passive users who simply like using the same card for all their shopping and don’t want to put any effort into staying on top of their earn rates and perks. Cardholders who will get the most out of their premium credit card are those who enjoy taking an active role in their credit card management and who make a habit out of keeping track of their rewards and benefits. Unless you make use of a premium credit card’s benefits, it likely won’t be worth the annual fee and you could end up losing money. Engaged cardholders who get pleasure in maximizing earn rates and taking advantage of benefits like free checked bags and rental car discounts will get the most from a premium card and could very well save hundreds of dollars a year thanks to their smart use of perks.

A premium card is also not a good fit for someone who often carries a credit card balance from month to month or frequently uses their credit card for cash advances. Premium cards tend to have higher interest rates and fees than standard credit cards. If you carry a balance regularly, the interest will quickly add up and eat into your reward earnings and benefits. Likewise, if you’re not very organized and tend to go over your spending limit or your payments bounce, then fees could very well erode the value of a premium card’s perks.

All in all, if you enjoy being actively engaged in your credit card management and don’t frequently carry a balance, you’re likely the ideal premium credit card user.

Pros and cons

Pros of premium credit cards

  • Accelerated earn rates
  • Comprehensive insurance packages
  • Helpful concierge service
  • May include airport lounge access and other hotel and travel perks like a free checked bag
  • VIP access to exclusive experiences and entertainment events

Cons of Premium Credit Cards

  • Require more effort to manage in order to stay on top of benefits
  • Expensive annual fees
  • High income and good credit score may be required
  • Might come with higher interest rates, making it more costly if you carry a balance

So, are the perks really worth the extra fee?

The perks sound great on paper, but when you break down the cost of each, is it really worth shelling out hundreds a year for a credit card?

If you travel often for business or pleasure, then chances are even the most expensive premium card will be worth the investment. For example, a Priority Pass membership to access airport lounges costs $132 ($99 USD), and each visit is $32. With a credit card with a free membership and a let’s say four free lounge passes per year, you’ve already saved $260 and likely covered the expense of the card.

When it comes to insurance, the cost-benefit breakdown isn’t always as simple since it depends on a lot of factors such as what type of insurance you’re getting, the coverage from your credit card providers versus an external provider, your age, where you’re travelling, and more. However, as an example, if you plan on travelling and renting a car during your trip, you can be paying hundreds out of pocket for rental car insurance, trip cancellation insurance, and travel medical insurance when a premium credit card would cover all those expenses.

On the flip side, if you’re spending $500 a year on an annual fee to get insurance on travel that you only do once a year, then it likely won’t pay off. You can probably purchase insurance on your own for around $100 or less and save yourself the annual fee.

Final word

I definitely think premium credit cards are worth the fee but only as long as you use them in a way that maximizes their advantages. To take advantage of all that a premium card has to offer, a cardholder does have to be prepared to stay on top of making the most of accelerated earn rates and benefits like insurance and airport lounge passes. Certainly, a premium card does take a bit more effort to manage than a basic no-fee card but there can be big rewards for a cardholder willing to put in the effort.

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Sandra MacGregor Freelance Contributor

Sandra MacGregor has been writing about finance and travel for nearly a decade. Her work has appeared in a variety of publications like the New York Times, the UK Telegraph, the Washington Post, Forbes.com and the Toronto Star.

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