You’ve probably already heard about the American Express CobaltTM Card and all of its benefits. You might also know that the 30,000 Membership Rewards® points welcome bonus is worth $300 when used as a statement credit for travel. This makes signing up to the American Express Cobalt Card an easy decision.
However, don’t let the shining welcome bonus blind you from the rest of the benefits that come with this Card—there’s a lot more to the Cobalt Card than meets the eye. With flexible points earning rates, extensive travel insurance and up to $100 in hotel credit at participating properties, there are plenty of reasons the Cobalt Card is one of Canada’s favourite travel credit cards today.
The American Express Cobalt Card has only been around for a short while, yet it’s already becoming one of Canada’s favourite credit cards. The Cobalt Card is targeted at millennials and near-millennials, though they’re not the only ones who are taking advantage of the great benefits that come with this awesome Card. In the following post, you’ll learn why so many Canadians today are choosing the Cobalt Card as their favourite everyday spending card. It’s not just about a strong welcome bonus at a very reasonable fee—it’s about all the other Cobalt benefits you get year after year.
Pros & Cons Of The American Express Cobalt Card
Before we focus on the long-term benefits, let’s take a look at the most important pros and cons that come with the Amex Cobalt:
| • Monthly fee of just $10 instead of an annual fee|
• Up to 30,000 MR welcome bonus points for using your Card every month
• $100 in hotel credit annually
• One of the best and most flexible points earning rates of any credit card in Canada
• Points are easy to use
• Up to 9 additional Cobalt Cards for free
|• Annual $30,000 cap on the 5X earning rate (equivalent to 150,000 MR)|
Amex Cobalt Features & Benefits
|Welcome Bonus||• 2,500 MR points every month you charge at least $500 to the Cobalt Amex Card, for a total of up to 30,000 MR points|
|Travel Benefits|| • $100 hotel credit for spa, restaurants and other amenities at The Hotel Collection participating properties|
• Complimentary room upgrades at The Hotel Collection participating properties (subject to availability)
|Additional Card Fee||Up to 9 free additional cards|
|Points Earned Per $1 Spent||• 5X on eligible eats and drinks, including groceries and food delivery|
• 2X on eligible travel, transit & gas purchases
• 1X on everything else
|American Express Invites||✔|
|Travel Coverage||• Out of Province/Country Emergency Medical Insurance (For under age 65)1†|
• $250,000 Travel Accident Insurance2†
• Flight Delay Insurance1†
• Baggage Delay Insurance1†
• Lost or Stolen Baggage Insurance1†
• Hotel Burglary Insurance1†
• Car Rental Theft and Damage Insurance1†
|Purchase Coverage||• Buyer’s Assurance Protection Plan1†|
• Purchase Protection Plan1†
|Eligibility||• Canadian citizens or residents|
• A valid Canadian Credit file
|Type of Card||Credit Card|
|Applied Interest Rate||• 19.99% on purchases|
• 22.99% on funds advances
Looking Past The Welcome Bonus
This post is about all the long-term benefits of the Amex Cobalt Card, so I won’t linger much on the welcome bonus. All I’ll say is that you can expect great things during the first year of Cardmembership!
During the first year, every month that you charge a minimum of $500 in purchases to your new Amex Cobalt, you will receive a 2,500 MR points bonus. That means that, if you manage to get all twelve bonuses, by the end of the year you’ll have 30,000 MR points. We value them at 1 cent apiece, making those monthly bonuses worth $300.
Related: Read our full Amex Cobalt review.
The welcome bonus alone was enough for me to sign up for the Amex Cobalt Card, and it’ll probably be enough for pretty much everyone. But if you want to know why I’ve kept it in my wallet ever since, and why I use it every time I get the chance, read about the other long-term benefits below.
The Top Five Long-Term Benefits Of The Amex Cobalt Card
The American Express Cobalt Card is loaded with benefits specifically tailored for today’s inter-connected, app-oriented, service-driven economy. This is why most millennials love it so much. Nevertheless, there are five big winners that provide hundreds of dollars of value and make the Cobalt Card a smart investment well beyond the first year.
Long-Term Benefit #1: The Best Points Earning Rate
The Amex Cobalt Card earns Membership Rewards points (MR points for short) for every dollar of purchases charged to it. These points go to American Express’ loyalty program, Membership Rewards. If you find this familiar, it’s because other Amex Cards like the Platinum Card®, the Business Platinum Card®, and the Gold Rewards Card, among others, also earn the same kind of points.
But one of the things that sets the Cobalt Card apart from these other options is its unique reward scheme:
- 5X on eligible eats and drinks
- 2X on gas, transit and eligible travel purchases
- 1X on everything else
If this doesn’t intrigue you, it’s probably because you still haven’t crunched your numbers yet. Let’s break it all down to show you just how great this earning rate is:
5X on eligible eats and drinks
This is one of the highest earning rates you’ll get on any credit card, period. Considering the value of MR points, no other card offers this level of return on your spending, unless you consider sporadic special offers with very specific merchants, like with some of the AeroplanPlus® Cards.
But the real kicker of the 5X earning rate is how easy it is to get it.
The broad definition of the “eats and drinks” category includes restaurants, quick-service restaurants, drinking establishments, coffee shops, grocery stores, and even food delivery services in Canada, like Uber Eats.
This means you can get 5X the points every day, whether you’re eating out, ordering take-out, cooking at home, on a date, or at a nightclub with your friends.
The Cap On The 5X Earning Rate
As of August 20th, 2019, the earning rate cap is set to $30,000 in purchases (in the eats and drinks category) or 150,000 MR points, which resets every year. After you hit the $30,000 annual cap, your earning rate drops to 1X.
2X On Gas, Transit And Eligible Travel Purchases
The Cobalt Card also earns 2 points for every dollar spent on travel, gas and transit expenses, a very generous earning rate for a card that only costs $120 per year.
The best thing about it is that this earning rate is just as easy to access as the eats and drinks category.
Because it includes any purchase at any stand-alone gas station in Canada, which is great if you own a car, but it also includes payments to local commuter transportation options like taxis, buses, subway, and even Uber rides, as well as more exotic ways to get around like renting a limo. So whether you have a car or not, this earning rate is likely to benefit you in a serious way.
You’ll also get 2X on travel bookings including transportation and lodgings, as well as when paying tour operators. There is no cap on this 2X earning rate.
So, unless you get around on foot or on your own bike, chances are that you’ll be able to use your Cobalt Card and get the 2X earning rate every day, everywhere that you go.
1X On Everything Else
Want to buy some clothes or a new phone? Don’t worry, you’ll still get rewarded for using your Cobalt Card. In these cases it may make more sense to use a card that’ll reward you more for your money, like the SimplyCashTM Preferred Card, which gives you 2% cash back on every purchase (and comes with an annual fee of just $99). But as you can see, the Cobalt Card’s benefits include exceptional earning rates on two categories you likely spend on every day. This is why we consider the American Express Cobalt Card the best everyday spending card in Canada today.
Long-Term Benefit #2: Travel And Purchase Insurance
Even though the American Express Cobalt Card’s $10 monthly fee is very affordable, it still comes with a very comprehensive travel insurance package, as well as the standard American Express purchase coverage.
The Cobalt Card’s Travel Coverage
The travel-related insurance coverages that come with your new Amex Cobalt Card include:
- Out of Province/Country Emergency Medical Insurance (For under age 65)1†
- $250,000 Travel Accident Insurance2†
- Flight Delay1† & Baggage Delay Insurance1†
- Lost or Stolen Baggage Insurance1†
- Hotel Burglary Insurance1†
- Car Rental Theft and Damage Insurance1†
Compared to the Platinum Card, which carries all of the insurance coverages Amex has to offer, the only two coverages that the Cobalt Card doesn’t have are Trip Cancellation and Interruption Insurance. Of course, the Cobalt Card costs almost $600 less, so this makes sense.
American Express Purchase Coverage
Regarding purchase coverage, the Cobalt Card comes with American Express’ two standard coverages:
- Buyer’s Assurance® Protection Plan1†. Your coverage can automatically extend the manufacturer’s original warranty up to one additional year when you fully charge eligible items to your American Express Cobalt Card.
- Purchase Protection Plan1†. You can be insured for eligible items charged to your American Express Cobalt Card for 90 days from the date of purchase in the event of accidental physical damage or theft for up to $1,000 per occurrence (for all purchased items combined).
Read our full post on American Express Insurance to learn all the details regarding these and other insurance coverages offered by American Express in Canada.
How Much Is The Cobalt Card’s Insurance Worth?
It’s hard to estimate exactly how much you’re saving by having the insurance coverage that comes with your Cobalt Card.
However, here’s a quick estimate of the value of what we believe are the two most valuable insurances: Out of Province/Country Emergency Medical Insurance1† and Car Rental Theft and Damage Insurance1†:
- An equivalent travel medical insurance (15 days, $5,000,000 in coverage) for one 35-year-old traveler in perfect health costs a minimum of about $80 in Canada, depending on your insurance provider. Add in your spouse and one child and the cost, at the very least, doubles. If you add in more children and additional Cardmembers, you’ll be well beyond $200.
- For a rental car with a value of $85,000 or less, Theft and Damage insurance can cost $16 to $23 per day. Therefore, paying with your Cobalt Card for a a short, 3-day rental could be saving you anything from $48 to $70. The longer the car rental, the more you’re saving on insurance.
That means if you took a solo 15-day trip and rented a car for 3 days, you’d be looking at at least $80 in medical insurance plus $48 in car rental insurance.
By using your Amex Cobalt Card year after year, you can easily save $120+ per year on insurance alone.
Long-Term Benefit #3: The Hotel Collection Benefits
Signing up to the American Express Cobalt Card gives you access to two special benefits at The Hotel Collection properties, like the JW Marriott Khao Lak Hotel and Spa in Thailand, shown above:
- Up to $100 in hotel credit to pay for dining, room service, spas massages and other amenities charged to your room (but not for the room rate itself)
- Complimentary room upgrades when available
You’ll only be able to take advantage of these benefits if book through American Express Travel, and you stay at any of the 600+ hotels and properties that make up The Hotel Collection at least once a year for 2+ nights.
Long-Term Benefit #4: The Referral Bonus
Another great option that American Express offers is the chance to boost your MR balance by referring your friends, family members and other acquaintances to the Cobalt Card.
Here’s how it works: When you sign up to the Cobalt Card, you’ll receive a personal referral link. When someone you refer to Amex signs up to the Cobalt Card through your referral link, you could get a bonus if American Express approves the referral.
The bonus for each approved referral is 5,000 MR points.
Now don’t get carried away counting all the friends and family members you plan to refer, as there’s a cap on this benefit as well. You’re limited to a maximum annual referral bonus of 75,000 MR points, which currently translates to a maximum of 15 successful referrals per year. Still, the potential to earn the equivalent of $750 every year, just for recommending your friends, is certainly a nice bonus.
Long-Term Benefit #5: Up To 9 Free Additional Cards
Do you want to make the most of the Cobalt Card’s awesome earning rate? The simplest way is to give your loved ones a supplementary Cobalt Card linked to your account. That way, whenever they use their card for their everyday purchases, they’ll help you build up your Membership Rewards balance.
Of course, you can get additional cards for any American Express card, but in most cases, you have to pay an additional fee for each one. Additional Cobalt Cards, on the other hand, are completely free.
How Do The Long-Term Benefits Compare To The Card’s Fee?
The following table shows very conservative estimated values for the long-term benefits that come with the Cobalt Card, and how they compare to the accumulated annual fee.
|Annual hotel credit at The Hotel Collection properties||$100|
|Travel and Purchase Insurance||$150|
|One successful referral bonus per year (5,000 MR points)||$50|
|$500 in monthly spending on eligible eats and drinks (2,500 MR points earned per month)||$300|
|$150 in monthly spending on gas, transit and eligible travel purchases (300 MR points earned per month)||$36|
|$500 in monthly other spending (500 MR points earned per month)||$60|
|Accumulated Annual Fee ($10/month)||($120)|
|Estimated Net Profit From Benefits||$576|
The above estimate only involves one trip per year and very conservative monthly spending amounts. Regardless, you still come out winning by over $500 in the end.
Another way to look at things it that you only need to earn 12,000 MR points to offset the annual fee. You can earn 12,000 MR points just by spending $200 per month in eligible eats and drinks on the Card.
So are you ready to join the thousands of other Canadians with an American Express Cobalt Card?
1 Underwritten by Royal & Sun Alliance Insurance Company of Canada. You may contact the insurer at 1-888-877-1710 in Canada and the U.s. or visit www.rsagroup.ca.
2 Underwritten by Chubb Life Insurance Company of Canada (“Chubb Life”).
†: All insurance coverage is subject to the terms and conditions of their respective master policies. Certain limitations, exclusions and restrictions apply. Please read your Certificates of Insurance carefully.