American Express Platinum Card® Review: Premier Value for the Right Type of Cardholder

As one of the world’s great credit issuers, American Express credit cards sit mostly in the high-end category. And you don’t get much higher than The Platinum Card® from American Express. It’s a feature-rich product that earns rewards points at substantial rates, and has a list of perks you’ll need a long break to read.

We don’t have to tell you, though, that particularly in the credit card world you get what you pay for. The Platinum Card® from American Express has one of the steepest annual fees on the market, at $550. Is the shiny card worth the money?

60,000 Membership Rewards Points welcome offer -- New members who make $5,000 in qualifying purchases on the card within the first three months of ownership earn this offer.

Five points per $1 on qualifying travel -- The traveler in me appreciates this extremely high rate, which can quickly rack up the points even with modest spending. There are two important caveats to bear in mind, however:

• Air tickets must be booked either through the airline directly or via American Express Travel. No other outlet earns at the five points per $1 rate.
  
• Hotel room bookings need to be made through the issuer’s AmericanExpresstravel.com portal in order to earn at the five points per $1 rate.

$200 per year for Uber rides -- Doled out in monthly installments of $15 each (plus an extra $20 in December), American Express reimburses cardholders for booking the ride-sharing service, and automatically bumps them up to VIP status. In order to activate this perk, customers merely need to list this card as a means of payment in the Uber app. They do not need to pay for their ride with the card to receive the reimbursement.

$200 per year for incidental airline fees -- “Incidental” basically means everything but the ticket. These expenses are reimbursed up to that amount. Such incidentals include in-flight meals and drinks, so live it up in the air!

$100 TSA Pre✓® or Global Entry credit

Free airport lounge access -- Members are automatically enrolled in the Priority Pass™ lounge program at the Select level, which grants free access to around 1,200 such facilities around the world. Card members are also granted access to the American Express Global Lounge Collection. They can also use Delta and American Express lounges if they’re flying those airlines, and present their card at the entrance.

Free Boingo Wi-Fi -- The Wi-Fi service that is prevalent in airports is entirely gratis to members. For free enrollment in Boingo’s American Express Preferred Plan, card members must authenticate their plastic with Boingo and create an account.

Up to $550 in hotel and resort benefits -- American Express will provide a set of hotel extras such as for bookings made at lodgings in its FINE HOTELS & RESORTS collection. This package includes:

• Room upgrade (when available)
  
• Free Wi-Fi
  
• Daily breakfast for two
  
• Late (4 p.m.) checkout
  
• 12 p.m check-in (when available)
  
• One “unique” amenity (such as one-way transfer or food/beverage credit)

No foreign transaction fees -- Who wants to shell out extra money when they’re enjoying themselves abroad? Not members, who won’t pay these annoying little charges when they make purchases with their card outside of the U.S.

High annual fee -- Yes, it’s a card for big spenders, but that $550 annual price tag is rich. Rival cards in the elite category have competitive feature sets, and aren’t as pricey.

Surprisingly, it seems you don’t need spotless credit to be granted The Platinum Card® from American Express. Individuals posting on credit card forums online report obtaining a “lower” (i.e. Green or Gold) American Express card with a FICO score of around 670, then eventually upgrading to a Platinum. For the latter, people have reported getting one with a FICO score of just over 720.

Membership Rewards is American Express' long-standing loyalty program. Points earned with purchases on American Express cards can be redeemed for merchandise and services. There is no limit as to how many a card member can accumulate. Earned points never expire.

Membership Rewards’ base rate per point is effectively $0.01 per point, although the ultimate value depends on how points are redeemed. Supplementary cards (i.e., additional cards issued for the same account) also earn points on spending. Members have the option of transferring their points to a big selection of outside travel and hotel loyalty programs.

The most popular way to increase the redemption value of your Membership Rewards points is to transfer them strategically. Several airlines and hoteliers offer redemption values higher than $0.01 per point. Here are a few that offer redemption values greater $0.01 per point:

Good redemption options:

On the flip side, other redemptions won’t maximize the value of points. These activities, in fact, will reduce value below the aforementioned $0.01 per point:

Poor redemption options:

No one wants to worry about damage or theft to a rental car, or medical expenses arising from an accident. Happily for cardholders, when they rent a vehicle they are automatically covered by their issuer’s car insurance policy.

There are many crucial details about this policy that need to be kept in mind, as well as a pair of critical options. Here’s a guide to the car rental insurance offered by The Platinum Card® from American Express.

Do you need to buy the insurance when renting a car?

As with other credit cards, the American Express car rental insurance policy is in force when a cardholder pays for the entirety of a rental with his or her card and declines the rental agency’s optional insurance (often called the collision damage waiver).

This coverage is provided free of charge as a perk to many credit card holders, including those with the American Express Platinum Card® in their wallet.

American Express offers secondary insurance

American Express car rental insurance provides secondary coverage. This means that it supplements the existing car rental insurance policy of the cardholder (known as “primary” insurance). If the cardholder does not have his or her own auto insurance policy, the American Express insurance becomes primary.

It is vital to understand the distinctions between primary and secondary coverage, as the difference can amount to thousands of dollars.

• Primary insurance -- Your personal (or family) auto insurance policy is considered primary coverage. It is your go-to insurance policy, the first line of coverage in case of an accident or theft.
  
• Secondary insurance -- This is insurance that supplements the renter’s existing auto policy. It will pick up the fees and charges that are not covered on the primary policy, chiefly that policy’s deductible. Again, the American Express car insurance is secondary coverage.

In case of accident or theft under the issuer’s coverage, the renter must file a claim with both the primary insurer and the secondary insurance provider. In that case, the renter will be liable for the primary insurance’s deductible which, in most cases, will then be covered by American Express car insurance. Since a claim is filed on the primary insurance, premiums may rise on that policy.

What's covered

The American Express car insurance policy insures the rental for up to a total of $75,000 for the rental contract, for a period of up to 30 days. This covers the following:

The actual cost of repairs, or the wholesale book value net of salvage and depreciation costs, or the purchase invoice price net of salvage and depreciation costs -- whichever is the lesser.

“Reasonable and necessary charges” arising from the damage or theft, which include:

• Loss of use charges -- rental agencies often charge for the theoretical loss of being unable to rent the auto while it’s being repaired.
  
• Towing fees that aren’t covered by roadside assistance programs available to the insured party or parties
  
• Vehicle storage

What's not covered

As with most types of auto rental insurance, there are numerous costs and instances not covered under the American Express car insurance policy. Among others, this list comprises:

General exclusions, including:

• Operation of the vehicle in violation of the rental agreement’s terms and conditions
  
• Losses incurred while the vehicle’s driver was intoxicated by alcohol
  
• Any off-road operation
  
• Injuries to anyone or anything besides the rented vehicle
  
• Personal liability

Any auto not classified as a “Rental Vehicle” by American Express, which the issuer defines as “a four-wheeled, two-axle passenger type motor vehicle, designed for and sold to accommodate private passenger transport on public roads.” These are some of the vehicles not covered by the policy.

• Cargo vans.
  
• Trucks with gross vehicle weight ratings of over 10,000 lbs.
  
• Antique vehicles (defined as those that are 20 years old, or haven’t been made within the last 10 years, at least).
  
• Autos rented in Australia, Italy, New Zealand, and in nations within the Treasury Department’s Office of Foreign Asset Control group of sanctioned countries.

Losses that are characterized as

• Intentional damage by the driver
  
• Vehicle confiscation by authorities
  
• Manufacturing defects in the rented vehicle
  
• Standard wear and tear
  
• Theft/damage to Rental Vehicles not locked or secured

Premium car rental protection options

In order to kick American Express car insurance up to higher tiers of protection, holders of The Platinum Card® from America Express should seriously consider purchasing the issuer’s Premium Car Rental Protection. This is a flat-rate addition to the base American Express car insurance policy that ranges from $12.25 to $24.95 for the entire rental period. The price depends on the cardholder’s state of residency, and which of two coverage options they choose.

Premium Car Rental Protection makes American Express’s overall coverage primary. The two options also differ from the company’s standard coverage in numerous terms, such as:

Is American Express car insurance worth using?

For a premium credit product, the Platinum Card® from American Express is actually not that generous when compared to other high-end credit cards. A number of these, including the Chase Sapphire Preferred® and Chase Sapphire Reserve® cards and Citi Prestige®, include primary car insurance as one of their perks.

The coverage offered by The Platinum Card® from American Express only becomes primary if a user pays a little extra for one of the Premium Car Rental Protection options. These are more than worthwhile, as they not only make the insurance primary, but (in most categories) raise the levels of protection.

The two options are very cost-effective, particularly given that Platinum Card® owners are typically quite well off. The price difference between the two options for non-California or Florida residents is only $5, so there’s no reason not to get the maximum coverage available.

Like many credit cards, it’s possible to add an authorized user or several to the card, essentially sharing one account among several people. This isn’t free -- American Express charges a $175 annual fee for up to three additional cards and a further $175 per additional card beyond three.

The $175 fee certainly isn’t pocket change, but spending it to add card members can quickly pay off. Let’s delve into three reasons why.

1. Additional card members get a statement credit for Global Entry and TSE Pre ✓® application fees

A particularly useful perk enjoyed by the airport warriors who hold this card is the reimbursement of application fees for the Global Entry and TSE Pre✓® trusted traveler programs. American Express reimburses holders $100 for the former and $85 for the latter, in the form of statement credit. American Express extends this perk to all additional cardholders.

2. An authorized user also get valuable insurances

Additional card members receive the following protections:

Free travel accident insurance -- As long as 100% of the common carrier fare for a trip is paid with the card, the travel accident insurance policy by American Express is in force. The policy covers injury from an accident during transport. The card member is covered by up to $500,000 depending on the type of injury.

Free baggage insurance -- Your body is not the only object you can insure with the card. Both basic and additional card members are covered under the issuer’s baggage insurance plan, which compensates for lost luggage. Again, this comes into force when the card is used to pay the full fare on a common carrier.

The policy pays out replacement costs of up to $3,000 per piece of lost luggage depending on where the loss was suffered, and the type of luggage lost (i.e. checked, carry-on, etc.). On top of that, this policy also insures what it terms “high-risk” items for a maximum of $1,000 apiece. Several categories these objects fall into are:

• Computers
  
• Cameras and other photographic equipment
  
• Furs or items made mostly of, or lined with, fur
  
• Objects made of gold, silver, or platinum, even if only partially

3. You can limit the authorized users spending

The sky doesn’t have to be the limit for your additional card members. If the basic card member would like to put a cap on the monthly spending of those folks, he or free is free to make such a request to American Express. If approved, the request becomes law -- the requested amount is their new spending limit.

This additional card member limit is strictly optional and is at the discretion of the basic card member.

I would unhesitatingly recommend this card to anyone who wants or needs a travel credit card and travels more than once every year. That’s because the card has one of the best traveler-friendly feature sets on the scene just now.

No matter what a voyager does to prepare before, or experience during, their trip, The Platinum Card® from American Express will pay back in some way.

Book your flight with the airline or with American Express, and rack it up with that five points per $1 earnings rate. When at your destination, enjoy peace of mind knowing you’ll pay exactly nothing in foreign transaction fees. Coming home, relax in a well-appointed airport lounge before the long flight.

Make no mistake, this card is still generous and powerful for the more home-bound, with a welcome offer that’s one of the best out there. But considering its high annual fee, people who aren’t frequent travelers might be better off with a top-shelf card that offers a more general feature set.

For a complete list of rates and fees for The Platinum Card® from American Express, please visit this page.