Between the relaunch of Aeroplan and the announcement of a slate of new credit card releases from the big banks – the Canadian credit card market has seen its fair share of recent shake ups. Another change is around the corner as CIBC is significantly revamping its CIBC Dividend® Visa Infinite* Card in February 2021.
Arguably the card’s most popular feature – the ability to earn 4% on gas and groceries – will remain, but rewards on other widely-popular spending categories is set to double. Not all the changes are positive however, as the card’s travel insurance coverage will experience a downgrade.
Here’s a breakdown of what’s changing (and what’s not) with the CIBC Dividend® Visa Infinite* Card.
Changes coming to the CIBC Dividend® Visa Infinite*
Our thoughts on the CIBC Dividend® Visa Infinite* Card changes
Improved bonus categories
When it comes to changes to rewards you’ll earn on everyday spending, there’s plenty to like.
The first bit of good news is cardholders will continue to earn an impressive 4% cash back on both groceries and gas – a combination no other cash back credit card can beat. In another positive move, the card is ditching its niche 2% cash bonus on Telus and Tim Hortons purchases in favour of far more universal categories.
Effective February 2021, cardholders will earn a solid 2% cash back in three new bonus categories: dining, transportation (which includes public transit, taxis, and even rideshares), as well as recurring payments.
It’s clear the shift in the CIBC Dividend® Visa Infinite* Card’s rewards structure is in response to the spending habits of Millennials, who are just as likely to eat out or hop into an Uber as they are to buy groceries or fill up the gas tank of their own car. The introduction of recurring payments as a new bonus category also means cardholders will be able to pocket double the cash back on eligible streaming services along with phone and internal bills that are automatically set to charge their credit card on a recurring basis as a pre-authorized payment.
Just like before, any purchases that don’t fall under one of the card’s bonus categories will earn 1% cash back.
So, how will these changes impact your total annual rewards? Let’s run through an example assuming an average of $1,600 is spent per month on the following:
After running the numbers, we found the new card would earn $404 in cash back annually versus $347 compared to the current version. That’s a $58 increase.
Effective October 28, 2021, new users of the CIBC Dividend® Visa Infinite* Card can get a first-year annual fee rebate for themselves and up to three authorized users† and 10% cash back for the first 4 statements on net purchases of up to $2500.†
Save on gas
Cardholders can also link and use their CIBC Dividend® Visa Infinite* Card with Journie Rewards to automatically save up to 10 cents per litre† at participating Pioneer, Fas Gas, Ultramar and Chevron gas stations.†
Anytime cash back redemption
With the current CIBC Dividend® Visa Infinite* Card, you’re forced to wait till your January statement arrives every year just to receive your cash back rewards. It’s a rigid redemption system that’s about to get a whole lot more flexible.
Starting February, you’ll be able to redeem cash back at any time of the year as many times as you like. Redemptions must be made in increments of at least $25 and can be requested by logging into your CIBC online account, via the CIBC Banking App, or by contacting CIBC customer service over the phone.
Mobile device insurance
Mobile device insuranceis an increasingly popular perk that’s being offered by more and more credit cards, and soon, the CIBC Dividend® Visa Infinite* will join the club.
Cardholders will receive up to $1,000 in coverage in the event their device is lost, stolen, or damaged.
Coverage is automatic so long as you buy a new device or pay for each monthly bill (if you’re on a contract) in full using your CIBC Dividend® Visa Infinite* Card. Unfortunately, if you’re an existing CIBC Dividend® Visa Infinite* cardholder, coverage won’t apply to your current device and will only kick in on a new smartphone you buy after February 2021.
There’s no upfront cost for credit card mobile device insurance, but you’ll need to pay a deductible when – and only if – you make a claim. Deductibles usually hover around $100, and all things considered, comes out to a whole lot less than having to pay for a completely new device.
Mobile device insurance will only apply to one smartphone at a time and for up to two years per device.
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Increased annual fee
Currently one of the few premium credit cards to charge a below-average annual fee of $99, effective February, the CIBC Dividend® Visa Infinite* Card’s annual fee will jump slightly to a more conventional $120.
While an increase in annual fees is always a bummer, the good news is the card’s improved rewards on everyday spending will mean most cardholders will likely come out ahead and earn far more in cash back every year than the $21 increase in fees.
There’s also some silver lining in that the annual fee for authorized userswill remain steady at $30 just like before. And if you have a CIBC Smart™ Plus Account, you can have the annual fee waived consistently each year (though it’s only really worth having the account as long as you maintain a minimum balance of $6,000 or hold at least $100,000 in investments with CIBC; otherwise you’ll have to pay a $29.95 monthly account fee).
Fewer travel insurance perks
The CIBC Dividend® Visa Infinite* will experience a pretty notable decrease in its credit card travel insurance package.
The card will no longer offer coverage for:
- Trip interruption insurance: when travel plans have to be altered due to an emergency after the departure date (e.g. you’re unable to continue a flight due to unexpected injury during a layover)
- Flight delay insurance: reimbursement of costs arising from an unexpected flight delay (e.g. the cost of a hotel stay in the event your flight is delayed due to bad weather conditions)
- Baggage insurance: reimbursements for essential items lost in your baggage after it’s been checked in.
The CIBC Dividend® Visa Infinite* will continue to offer what’s arguably the most critical type of travel insurance coverage – $5,000,000 in out-of-province medical insurance – though the coverage period will decrease from 15 days to trips of 10 days for those under the age of 65.
While booking travel probably isn’t a top priority for now, the removal of these perks is a drawback in the long-term considering non-essential travel will inevitably return at some point. It’ll be interesting to see if and how other credit card issuers (and travel insurance policies overall) will adjust their coverage given the state of our new normal.
The bottom line
In our opinion, the positive changes coming to the CIBC Dividend® Visa Infinite* far outweigh the negative.
The combination of the card’s improved earn rate and more flexible redemption system easily offset the marginal jump in the annual fee. And while the downgraded to the card’s travel insurance package is a tough pill to swallow, with non-essential travel off the agenda for the foreseeable future and out-of-province medical insurance still included for trips of up to 10 days, it’ll suffice for most casual flyers when travel eventually comes back to some semblance of normal.