If you pay with points or miles, do you still get your card’s travel insurance?

scyther5_istock_Getty Images

scyther5_istock_Getty Images

Credit cards, especially travel rewards cards, have various protections for the many things that can go wrong during travel – reimbursement for lost luggage, trip cancellation/interruption coverage, rental car coverage and trip delay coverage, for example.

If you look at the fine print for these protections, though, you’ll always see this caveat: You must use your card to pay for the travel in question (in whole or in part, varies by card) to be protected. For example, you can’t pay for the trip on your cash-back card and then try to use your premium travel card’s protections when you need them.

But what if you cash in rewards to pay for the trip instead of using your card? Several issuers have travel-booking portals that allow you to “pay with points.” And some incentivize you to use your points this way.

Because the charge never hits your card, are you still protected? We asked several large issuers for their policies.

Note: Some cards’ redemption systems require you to purchase your travel first and then get paid back with a statement credit (The Capital One Venture Rewards Credit Card and the Barclaycard Arrival+, for example). Because you’re paying with your card up front, there’s nothing to worry about; you’ll get the travel protections your card offers, assuming you fulfill its other requirements for protection. In this article, we’re addressing only the travel portals that allow you to pay with points up front and not pay a cent of your own money first.

Chase Ultimate Rewards

Are you still protected? YES

“Cardmembers can still take advantage of the trip protections their Chase card offers if they book with points through Chase Ultimate Rewards,” a Chase spokeswoman wrote in an email to CreditCardForum.

See, for example, Chase’s terms for its trip delay coverage, which includes a clause that rewards trips are eligible for protection:

Trip Delay Reimbursement Chase proof

Advantages of paying with points
While there may be better ways to maximize the value of your points (by transferring directly to Chase’s partner frequent flier and hotel programs, for example), paying for travel through the Chase Ultimate Rewards travel portal has its advantages, too:

If you have the Chase Sapphire Preferred, your points will be worth 1.25 cents each, up from 1 cent each when redeeming for cash back.

If you have the Chase Sapphire Reserve, your points will be worth 1.5 cents each in the portal.

American Express (a CreditCardForum advertising partner) Membership Rewards

Are you still protected? YES

“If a card members pays with points on the Membership Rewards travel portal to book a flight, they would still receive the benefits embedded with their card,” wrote an American Express spokeswoman in an email to CreditCardForum.

Citi ThankYou program

Are you still protected? YES

“The cardmember would still be eligible for travel benefits if they use their Citi card and use ThankYou Points to pay to travel,” a Citi spokesperson wrote to us.

Advantages to booking through the portal
First, a familiar refrain: Transferring directly to Citi’s airline partners may get you more value per point. But paying with points in the ThankYou portal has advantages, too. If you have the Citi Prestige card, for example, your points are worth a little extra if you redeem via the travel portal (1.6 cents each toward American Airlines tickets, 1.33 cents each for other airlines). Note: These value boosts will both decrease to 1.25 cents each in July 2017.

What about airline cards?

Airline rewards programs create a complicated situation. On one hand, your co-branded airline card likely provides travel protections. On the other hand you’ll be earning frequent flier miles with that card, which you’d probably like to eventually cash in for rewards flights. And that can be bad news, as far as protections are concerned.

With the American Express Gold Delta SkyMiles card, for example, rewards flights don’t receive the card’s built-in protections for travel accident insurance:

Amex delta gold travel accident insurance terms

But United rewards flights may receive the protections offered by Chase’s co-branded United cards:

Chase united cards travel accident insurance coverage terms

So review your card’s coverage carefully – and consider stand-alone travel insurance for big rewards trips if your card won’t cover you.

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