After travelling for a few years, we became aware of the valuable benefits that the American Express Platinum offered. Because of the pandemic, we’ve been unable to travel freely for over a year. Seeing our bill land for another annual fee was the nudge we needed to reevaluate if we get enough value from the card. So, is it time to downgrade Amex Platinum? At a hefty £575 annual fee – it’s definitely a question worth asking!
What would you downgrade to?
Before we discuss the pros and cons of keeping Amex Platinum, it’s probably worth highlighting that we do have options that avoid us needing to completely close our Amex account. If we do that, we lose all of our Membership Reward Points, so it’s important we’re not binning a load of hard-earned points when we ditch the Platinum Card.
The Gold Card
The first option to keep our points is to downgrade the card to American Express Preferred Rewards Gold Card. This card earns Membership Rewards like the Platinum Card does, but it has fewer benefits. That said, you get a couple of lounge passes each year and recurring annual points bonus – if you hit the spend threshold. While it has some insurances, it lacks the full travel insurance offered on Platinum. You’re paying a lot less for it; a lot less. It has a much lower annual fee than the Platinum Card, and the fee is waived in the first year! It reverts to £140 in the second year.
The Basic Card
The other option is to downgrade to the basic American Express Rewards Credit Card. This card still earns Membership Rewards like Platinum and Gold, but it has no annual fee. For free, you shouldn’t expect anything near the benefits offered by the other two cards, but it’s far from a bog-standard credit card. Purchase and refund protection are included, as is Global Assist and travel accident insurance. If you’re “done” with paying fees for credit cards – but still want to hang on to the Membership Reward points – this might be the card for you. Given the Gold Card is fee-free in year one, it’s a no-brainer to switch to that, then drop down to the basic card in the following year.
Hold on! Before we decide to downgrade Amex Platinum, let’s first work out whether we should change anything.
Reasons to downgrade Amex Platinum
Given how heavy the card is on travel benefits, it seems like an obvious choice to downgrade Amex Platinum while we can’t travel anywhere! Travel insurance, Priority Pass lounge access and status with hotel chains are only useful when traveling and staying in hotels.
No leisure travel
We initially thought the international travel bans would be short-lived. The temporary reprieve in summer 2020 enabled us to take a couple of short trips within Europe.
The law currently prevents us Brits from leaving the country for recreational travel. We’ve been assured that law comes to an end on 17 May 2021. That said, we’re hearing of much uncertainty about which countries will let foreign tourists enter. The UK Government will introduce a traffic light system to indicate which countries have quarantine-free travel. The Government continue to delay the publication of a definitive list.
Countries are now guarding their vaccination efforts with tougher border controls. The increasing risk of a third wave is growing dark cloud over the resumption of international tourism.
In summary, it sounds like we’ll be able to travel this summer, but nobody knows where or for how long. While we think we can make this uncertainty work for us, many others will have already written-off overseas holidays in 2021.
Lounges are closed
For us, one of the biggest Platinum benefits is the Priority Pass lounge access. With lounges closed until COVID restrictions are eased, there’s little chance of getting much value from this benefit. Thinking back to first “great unlocking” in summer 2020, lounges were slow to reopen and offered minimal services for months afterwards. British Airways seemed to get things in order later in the summer, but airline lounges aren’t included with the Platinum lounge benefit.
Hotels are half open
For those willing to risk the heavy fines imposed for “unauthorised travel”, there’s no guarantee the status hotel chains will be able to honour your booking. If you’re fortunate to be able to check-in, the services available at the property may be very limited and entirely dependent on local restrictions.
Depending on where you choose to visit, the public areas of the hotel may be closed. If they’re open, expect to wear face masks. Sure, it’s better than staying at home, but will it feel like a holiday?
There’s still a £575 annual fee
It’s by far the most expensive credit card we have between us. Although we split the annual fee and have a card each, the cost still eclipses the other cards in our wallets. Points alone aren’t going to convince us to pay this kind of money for the card, so to us card benefits fundamental rather than ancillary nice-to-haves.
Reasons to keep Amex Platinum
There are many reasons not to downgrade Amex Platinum, but is it enough to warrant that hefty annual fee? We didn’t think so, but we crunched the “value” we’ve been getting from the card to be 100% sure.
Big statement credits for normal spending
We’ve benefited from two promotions over the last 12 months where we received statement credits for spend at Waitrose, John Lewis or Deliveroo. The first offer was for £100 and the second for £175 (£275 total value).
We received a £100 statement credit promotion for Harrods in October 2020. We jumped on the opportunity to stock-up the whiskey cupboard for Christmas and only paid £15 for two very nice bottles that should’ve been £115, delivered (£100 value).
Around the same time as the Harrods offer, we were also targeted for a Marriott statement credit promotion. If we spent over £400 at a participating hotel, we’d get £400 back. Twice we booked for a lovely-looking Marriott property in Buckinghamshire and twice we were foiled by changing lockdown restrictions, forcing the hotel to close. Eventually, the offer expired in December and then we went into an extended UK lockdown (£0 value).
Had we managed to stay at the Marriott, we’d have received a total of £775 in statement credits. Without that stay, we’re down at £375. Not all that bad, but leaves us looking for another £200 of value to balance the £575 annual fee…
Travel insurance at home
As well as international travel, Amex travel insurance covers you for holidays in your home country. Your trip can be anywhere in the country, but must include an overnight stay in pre-booked accommodation. This means the travel insurance covers a weekend trip to the seaside in your car, where you stay in an Airbnb, an overnight stay in a classy London hotel, or even a night in the B&B at the end of your street. The maximum trip length is a generous 90 days.
Source: Amex Platinum Travel Insurance Policy Documentation
Travel insurance still covers COVID
If the stars align between your origin and destination countries, will the Amex Platinum travel insurance cover you for COVID? Fortunately, this is not a concern for Platinum card holders. AXA, Amex’s insurance underwriter says:
“As long as you have not travelled against medical or government advice, if you become ill while on holiday and have Medical cover, your medical expenses abroad will be covered, subject to the terms and conditions of your Medical cover. In this event, please contact your 24-hour medical assistance team for guidance by calling the number on the back of your card.”
Source: AXA Travel Disruption Advice
Collision Damage Waiver
A less well-known Amex benefit is the car rental Collision Damage Waiver cover. When hiring a car, you’ll often be told there’s a large excess on the insurance. You’ll be asked to guarantee it with a credit card or buy additional insurance from the rental company to reduce your excess liability to zero. The insurance add-ons come packaged with lots of confusing names and are priced very high:
- Collision Damage Waiver (often referred to as CDW)
- Loss Damage Waiver (LDW)
- Removal/reduction of excess (Super CDW/LDW)
- Theft Protection (TP)
- Top Up/ Supplemental Liability (SLI)
If we pay for car rentals on our Amex Platinum card we’re for all of these up to £50,000. This has allowed us to refuse extra insurances on a number of car rentals, safe in the knowledge that, if the worst was to happen, we won’t be liable for the big excess.
The good news is this benefit also applies in our home country. Amex car rental insurance benefits cover any trip in our home country (as well as abroad). There is also no requirement for an overnight stay, so a 1-day rentals for a day-trip would be covered.
Points bonuses, if you call them
That’s right. We called them to say we weren’t getting enough value from the card to warrant the high annual fee. They responded by offering us 50,000 membership reward points to keep the card. We tend to give these points a nominal value of 1p each, although we try to find much higher redemption rates when we come to use them for travel. At the nominal value, we’re looking at the 50,000 points being worth £500. If you get this, it’s a big reason not to downgrade Amex Platinum.
Purchase and Refund Protection
No matter whether we’re home or abroad, the Platinum card provides a reasonable level of insurance for accidental damage or theft of new purchases made using the card. This cover is called Purchase Protection. In addition, Refund Protection means Amex will reimburse us for any unused item we purchase where the retailer won’t accept the return. When we’re making large purchases, we find these protections incentivise us to use the Platinum card.
Global Assistance Service
That number on the back of the Platinum card can be a life-saver. No matter where you are and whatever the problem, that number can help. We’ve only had to call Amex’s Global Assistance once when we were struggling to access local healthcare, but they were straight to the rescue. They found us a private hospital, arranged an appointment and advised on the paperwork we’d need to complete there so the insurance could pick up the bill. After that incident, we’re happy to apportion a sizeable chunk of value to this underrated card benefit. We hope we’ll soon get the all-clear from our Government to travel for leisure. When that comes, we’ll be able to travel in uncertain times with a little more confidence, knowing this number is in our pockets.
BG1 Verdict
Despite being unable to travel since Q3 2020, we decided not to downgrade Amex Platinum. We’re going to keep the card for another year. If we combine the insurance benefits with the value we’ve received from statement credits and the retention bonus, we’ve already recouped more than our annual fee over the past 12 months. We should be able to use the lounge benefits if we can get a few international trips in this year.
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