What happens to Aeroplan and other reward program points when you die?

Aeroplan is "capitalizing on someone's grief" by charging a fee to transfer points from a deceased member's account, says the family member of a woman who died leaving 250,000 Aeroplan points behind.

"It seemed so callous.It seemed really insensitive.And it seemed really unnecessary," says Kathryn Kwasnica of Victoriaafter finding out how much it would cost to transfer to her fatherthe 250,000 points accumulated by her late stepmother.

• Aeroplan membership growing faster than seats available, say members

But Aeroplan says it also offers a second option that allows users to avoid paying that cent per point charge altogether.

And even though the fees can be significant and travel booking potentially restrictive, compared with some other loyalty programs, Aeroplan has one of the better policies for dealing withpoints in the account of someone who has died.

Kwasnica's stepmother, Linda, started feeling ill about a year ago, but it wasn't until last summer that she was diagnosed with mesothelioma, an aggressive and deadly form of cancer.

"Six months later she was dead,"says Kwasnica. Linda was 68 when she died on Jan.7.

Kwasnica, acting on behalf of her grieving father, husband, called Aeroplan to find out what to do about Stewart's Aeroplan points.

She says she was told, in the event one of its members dies, Aeroplan charges a fee of $30 plus one cent per point to transfer the balance to a surviving family member.In Kwasnica's case, because her stepmother had about 250,000 points, the fee would have amounted to about $2,530.

"That seemed crazy for a data transfer," says Kwasnica.

Aeroplan defends itself

"My father passed away a year ago, so I completely empathize with members who are going through what they're going through," says John Boynton, Aeroplan's chief marketing officer.

"But we are always trying to balance shareholders and members, so there are certain costs that we have to recuperate."

For a flat $30fee, Aeroplan also offers the option to transfer those points to a newly created estate account, which can be used by surviving family members.But Kwasnica says she was told by the person she contacted at Aeroplan that the points in the estate account must be used in their entirety within one year.

Many Aeroplan trips need to be booked at least a year in advance, andKwasnica understood that to mean her father would have had to make travel reservations practically while planning his wife's funeral.

"Who wants to travel right after the love of their life dies and you've had the worst year of your life?"

But Boynton says that's not actually the case.

"A year is how much [time] you have to do something with them. But you can also book an Air Canada ticket up to a year in advance too, so that's two years. And if that's too soon for you, you can also buy an Air Canada gift certificate, which doesn't have an expiry, or a retail gift certificate as well."

However, redeeming Aeroplan points for a gift certificate does not always offer the best value compared with, for example, redeeming those points for an international flight in business class.

Maximizing revenue

Patrick Sojka of the website Rewards Canada says transferring points is not a large expense for a loyalty program.

"Honestly, [the fee], it's money-making,"he says.

"Ninetyper cent of all programs worldwide charge you a fee to transfer points and miles to somebody else [in the event a member dies]."

InSojka'sview, the fee is about maximizing revenue."The fact [is] that the miles on those accounts are a liability. The sooner they can get them off the books, the better," hesays.

High cost of dying

Compared with Aeroplan, other loyalty programs have terms and conditions surrounding death that are less favourable.

According to the terms and conditions for Shoppers Drug Mart's popular Optimum points program, "Upon the death of a Shoppers Optimum Member, the member's account will be closed and any Shoppers Optimum Points in the account will be forfeited."

Better not to tell?

But there may be ways around this.

In March2013, Delta Airlines changed itspolicy, declaring SkyMiles would no longer be transferable upon death.

As a result, travel writers, bloggers, and travel hackers started advising SkyMiles membersnot to notify the program of a death.

"It's a grey area. But you don't let the program know that that person's passed away," says Sojka, who also advises this.

"What you do is ensure that everybody has your log-in and passwords and then you can use those miles. Because when you book rewards flights, they don't have to be booked for yourself, they can be booked for anybody, essentially. You can go in and book points for yourself, your family members, you name it, using those points."

It's not clear ifcompanies will crack down on this apparent loophole, butSojka says he hasn't heard of any repercussions from taking this route.

Now that they know about it, Kathryn Kwasnica says her family willprobably go with the gift certificate option for her stepmother's Aeroplan points.

"I think my dad would probably be into that. Because I think for him, the thought of travelling right now is just disturbing."