The core benefits of the Sapphire Preferred
The Chase Sapphire Preferred is built around three main rewards categories: 3 points per dollar on travel purchases, 3 points per dollar on dining, and 1 point per dollar on everything else. The card also includes trip cancellation insurance, emergency medical and dental coverage abroad, and lost luggage reimbursement — benefits that matter most if you travel regularly or take trips that cost real money.
The card charges an annual fee of $95. Whether that fee makes sense depends entirely on how much you spend in the rewards categories and whether you use the travel protections. A person who travels twice a year and eats out regularly can recoup the fee through points alone; someone who travels once every few years may not.
The points themselves are worth more than points from most other cards because Chase lets you transfer them to airline and hotel partners at a 1:1 ratio, or redeem them for travel purchases through the Chase portal at 1.25 cents per point. That flexibility is the real advantage — you are not locked into one airline or hotel chain.
Key Takeaways
- You earn 3 points per dollar on travel and dining, which means a $3,000 annual dining budget generates $90 in value before the $95 annual fee.
- The card includes trip cancellation insurance, emergency medical coverage abroad, and lost luggage reimbursement — read the terms to understand what situations are covered.
- Points can be transferred to airline and hotel partners or redeemed for travel through the Chase portal, giving you more flexibility than cards locked into one program.
- The $95 annual fee is worth it only if you spend enough in the rewards categories to earn back the fee in value, usually $3,000 to $4,000 per year in those categories.
Travel protections and what they actually cover
Trip cancellation insurance reimburses you if you cancel a prepaid trip for a covered reason — illness, injury, or death of a family member are typical examples. The card covers up to $10,000 per person and $20,000 per trip. The catch is that you must have purchased the trip with the card, and the reason for cancellation must be unexpected. You cannot cancel because you changed your mind or because prices dropped.
Emergency medical and dental coverage kicks in when you need treatment while traveling outside the United States. This is not a substitute for travel health insurance if you are going somewhere remote or for an extended period, but it covers unexpected situations — a broken tooth, a minor injury that needs stitches. The coverage is secondary, meaning your regular health insurance pays first.
Lost luggage reimbursement covers baggage delayed more than 12 hours or lost entirely, up to $2,500 per person. Again, the airline must be responsible, and you must have purchased the ticket with the card. Read the full terms on the Chase website before you travel, because the exact situations covered and the documentation required vary.
How the rewards categories work in practice
The 3 points per dollar on travel covers airlines, hotels, rental cars, taxis, rideshare, parking, trains, and cruises — essentially anything you book for getting somewhere. Gas stations and parking meters count. Airline tickets bought through a travel agent count. What does not count: travel booked through a third-party rewards site that is not affiliated with the merchant.
The 3 points per dollar on dining covers restaurants, bars, and food delivery services. It does not cover grocery stores or gas station convenience stores, even if you buy food there. The distinction matters if you are trying to maximize points — a $100 grocery bill earns 100 points (1 point per dollar), while a $100 restaurant meal earns 300 points.
Everything else — groceries, gas, online shopping, utilities — earns 1 point per dollar. This is not a strong rewards rate, so the card makes the most sense if you spend heavily on travel and dining. If your spending is split evenly across all categories, a flat-rate card might earn you more.
The annual fee and when it makes financial sense
The $95 annual fee is charged every year on your account anniversary. Chase does not waive it after a certain period, and there is no way to downgrade to a no-fee version of the card while keeping your account open — you would have to close it and reopen a different card.
To break even on the fee, you need to earn at least $95 in value from your points. At the standard redemption rate of 1.25 cents per point through the Chase portal, that is 7,600 points. If you spend $2,500 per year in the 3-point categories, you earn 7,500 points, which falls just short. If you spend $3,000 per year in those categories, you earn 9,000 points, worth $112.50 — a net gain of $17.50 after the fee.
The math changes if you transfer points to airline partners, because some partners value points higher than 1.25 cents. A business class ticket that costs 100,000 points but would cost $5,000 to buy outright means each point is worth 5 cents. But those redemptions are harder to predict, so use the 1.25-cent baseline to decide whether the card is worth keeping.
Comparing the Sapphire Preferred to other travel cards
The main alternative is the Chase Sapphire Reserve, which charges a $550 annual fee but earns 3 points per dollar on travel and dining just like the Preferred, plus 1 point per dollar on everything else. The Reserve also includes a $300 annual travel credit that effectively reduces the fee to $250. The Reserve makes sense if you spend much more on travel and dining or if you value the higher-tier protections and lounge access.
Outside the Chase family, the American Express Gold Card earns 4 points per dollar on dining and airfare, but charges a $250 annual fee and does not offer the same transfer flexibility. The Citi Premier Card earns 3 points per dollar on travel and dining with a $95 annual fee, making it a direct competitor to the Sapphire Preferred — the choice between them often comes down to which airline and hotel partners you prefer.
If you do not travel frequently enough to justify an annual fee, a no-fee card like the Chase Freedom Unlimited (1.5 points per dollar on everything) or the Capital One Venture X (2 points per dollar on all purchases) might be a better fit. The trade-off is lower earning rates, but you avoid the annual fee entirely.
How to use the points you earn
Points can be redeemed three ways. First, through the Chase Ultimate Rewards portal, where you book travel directly and points are deducted at a rate of 1.25 cents per point. This is the simplest method and guarantees a known value. Second, you can transfer points to airline and hotel partners — Chase lists over 20 partners, including United, Southwest, Marriott, and Hyatt. Transfer rates are 1:1, but the value you get depends on the specific redemption.
Third, you can redeem points for cash back at 1 cent per point, which is the least valuable option. A $10,000 points balance becomes $100 cash back, whereas the same points might be worth $125 through the portal or significantly more through a transfer partner. Most people who earn points on this card should avoid the cash redemption.
The transfer partners change occasionally, and some partners offer better value than others depending on when you travel and where you want to go. Before you commit to the card, look at the current partner list on Chase's website and think about which airlines and hotels you actually use.
The sign-up bonus and ongoing value
Chase periodically offers a sign-up bonus on the Sapphire Preferred — typically 50,000 to 75,000 points after you spend a certain amount in the first few months. That bonus is worth $625 to $937.50 at the standard 1.25-cent redemption rate, which easily covers the first year's annual fee and then some. The bonus changes frequently, so check the current offer before you open the card.
The sign-up bonus is one-time only. You cannot earn it again unless you close the card, wait a certain period (usually 24 months), and reopen it. Some people do this deliberately to capture multiple bonuses over time, but it requires planning and tracking.
After the sign-up bonus, your ongoing value comes from the rewards you earn on everyday spending plus the travel protections. If you stop spending in the rewards categories or stop traveling, the card becomes a net cost rather than a benefit, and closing it makes sense.
Frequently Asked Questions
Do I have to use the points for travel, or can I cash them out?
You can redeem points for cash back at 1 cent per point, but that is the least valuable option. Points are worth more through the Chase portal (1.25 cents) or transferred to airline and hotel partners. If you do not travel, a flat-rate cash back card is probably a better choice.
What happens if I close the card — do I lose my points?
Your points stay in your Chase Ultimate Rewards account as long as you have at least one other Chase card that earns Ultimate Rewards points. If you close all your Chase rewards cards, the points expire. Plan your redemptions before you close the card, or keep a no-fee Chase card open to preserve the points.
Can I use the trip cancellation insurance if I book through a travel agent?
Yes, as long as you paid for the trip with the Sapphire Preferred card. The insurance does not care how you booked it — directly with the airline, through an agent, or through a travel website. Just make sure the card was the payment method.
Is the annual fee worth it if I only travel once a year?
It depends on how much you spend on travel and dining in that one year. If you take a $5,000 trip and spend $200 per month on dining, you earn roughly 10,000 points, worth $125 through the portal — enough to cover the $95 fee. If you take a $1,000 trip and rarely eat out, the fee is probably not worth it.
Can I transfer points to multiple airline partners on the same trip?
Yes. You can split a redemption across multiple partners, which is useful if you need flights on two different airlines or want to book a hotel and an airline separately. Each transfer takes a few business days to process, so plan ahead if you are booking close to your travel date.