There is no doubt that insurance premium is one of the bigger expenses that we have to fork out every year. It usually ranges from hundreds to thousands of dollars depending on what kind of insurance you have. With such big expenses, we should learn how to earn cashback or air miles from credit card programs.
However, oftentimes the bank usually excludes insurance premiums for any of the credit cards’ cashback or air miles. For those that believe that their credit card actually does reward you for everything you spend, you might want to check out your bank’s terms and conditions sheets on the credit card benefits under the list of exclusions.
So how can you bypass this?
Here are 3 ways that you can earn cash back or miles:
1) Apply for Credit Cards that reward you
For example, the UOB absolute cashback card or American Express True Cashback card:
Using any of the 2 cards above for insurance premiums will allow you to qualify for the cashback up to 1.7%. But do take note that the transaction is only applicable if your insurer accepts Amex as a payment method. If the insurer does not accept Amex payment, you can get around it by topping up your GrabPay Mastercard first and using the mastercard to process the payment using AXS app.
It is recommended to pay your premiums yearly instead so that you would not need to manually repeat the process of topping up your GrabPay Mastercard and paying your insurance premium monthly. On top of that, you get an additional 2% saving when you pay your insurance premium yearly!
However, there’s a transaction limit on the GrabPay Mastercard. If your insurance premium is more than $5000, you might face a problem paying your premiums. Therefore it is important to plan beforehand and see if this payment method works for you.
Take note of your expenditures on your GrabPay card as there is an annual transaction limit of $30,000. If your annual insurance premium takes up a huge portion of the transaction limit, you might want to reduce your other expenditures.
You should also note that you will not be receiving grab points for insurance payments.
2) Use third-party platform like CardUp
CardUp is a platform that allows you to earn miles, points and cashback on payment types that are traditionally not payable by credit card. Examples like insurance premium, income tax, car loan etc. CardUp will then charge a small fee as low as 1.7% (Up to 2.6%) per payment.
However, the rewards you earn on your card usually outweigh the fee that CardUp charges. Nevertheless, it will be good to do your own due diligence and check whether your credit card cashback or miles rewards outweigh the fee. You can also use the provided reward calculator to calculate how much you can save with CardUp.
One of the key benefits of using CardUp is that they do support a lot more bank credit cards that you might already have currently.
3) Use your insurer’s preferred credit card
Not all insurers have affiliated credit cards programmes. Therefore, it is important to check with your financial consultant or financial adviser whether there is such a programme in place whereby you can better maximize your money.
If you are a Great Eatern policies holder, you can consider getting the OCBC Great Eastern Cashflo Card. It does not necessarily give you cashback or miles if you use the card for your insurance premium but it does help you save some money. The credit card helps to split your yearly insurance premium payment into monthly payments with a small processing fee of 1%. It will definitely be a better payment method if you intend to pay your insurance premium on a monthly basis.
For Prudential policies holders, you can consider the Prudential Platinum Card. You are rewarded with points for every dollar you spend and the points can then be converted to offset your premium payments for your eligible prudential policies.
