When Air Canada entered bankruptcy in April of 2003, there was plenty of worry in the Great White North. After all, the nation's flagship carrier had the only traditional frequent flyer program in the country - Aeroplan. As time went on, the carrier eventually managed to emerge from the financial doldrums. In the meantime, though, some interesting things happened with Aeroplan.

For starters, it was shopped around as a separate business and rumors continue to swirl that it may yet stand alone. (This isn't terribly surprising - despite Air Canada's woes, Aeroplan has always been a cash cow.)

And many industry watchers seemed to see a distancing of Aeroplan from Air Canada - the program completely re-branded itself, and dramatically increased the number of non-flight awards.

Even the flyer-only portion of the program underwent significant changes.

And a more recent update:

Air Canada celebrates its 70th year anniversary this year and recently received the "Best Airline in North America" and "Best Airline in Canada" awards from readers of Global Traveler magazine. Air Canada's Aeroplan has been given two Freddie Awards for making innovative decisions. In 2003, Aeroplan received an industry impact award for its decision to allow elite members to choose their benefits and customize their elite package. Last year, Aeroplan received an award for its decision to make the program public via an initial public offering. The move has proven to be financially successful and shareholders are satisfied with the new arrangement, but what does Aeroplan have to offer its frequent flyers?

Earning ability

Within Canada, members earn miles on Air Canada, Air Canada Jazz, Air Creebec, Air One, Bearskin Airlines, Calm Air, Canadian North and First Air. Air Canada has six levels of booking classes and members flying on the airline's lowest fare, Tango, or in booking class X, earn 50 percent of miles flown with a minimum of 250 miles. Members also have the option of not earning miles for a CAD$3 reduction in the ticket price on Tango fares. In all other booking classes, members earn 100 percent of miles flown with a 500-mile minimum. Members flying in the highest class, Executive, also earn a 50 percent mileage bonus.

Air Canada is a member of the Star Alliance and on partner airlines, members generally earn 100 percent of miles flown with a 500-mile minimum, although mileage earning varies with the partner. Class of service bonuses also apply. On flights between Canada and Europe, Israel and the U.K., members earn between 250 and 500 bonus miles per one-way segment for online bookings. For flights to all other destinations, members can earn up to one bonus mile per dollar spent on eligible bookings at aircanada.com.

For Canadian residents, there are four American Express co-branded credit cards and three CIBC Visa cards and cardholders earn between 0.5 and 1.5 miles per dollar spent. For U.S. residents, Air Canada Aeroplan Platinum Plus MasterCard cardholders earn one mile per dollar spent.

Award choices:

Flight awards fall into two categories, ClassicFlight and ClassicPlus. There are no blackout dates for either award but capacity controls apply to ClassicFlight awards and ClassicPlus awards are only available on Air Canada and Air Canada Jazz. Economy class ClassicFlight award tickets within Canada and the United States are 15,000 miles for selected short-haul flights and 25,000 miles for longer flights. Business class ClassicFlight awards are 25,000 miles for shorter flights and 40,000 miles for longer flights. Flights from Canada to Hawaii or the Caribbean are 40,000 miles in coach and 60,000 miles in business; to Europe are 60,000 in coach and 85,000 in business; and to Asia are 75,000 in coach and 115,000 in business.

Air Canada and Air Canada Jazz ClassicPlus one-way flight awards are now available on routes that offer one-way pricing and the mileage required for one-way awards vary. Miles cannot be redeemed for upgrades and Aeroplan does not offer award auctions.

Hotel awards are available at over 4,900 locations worldwide with partner hotels such as Westin, Best Western, Sheraton and Delta Hotels. The newest additions to Aeroplan's hotel partnerships are Novotel, Sofitel, Club Intrawest and Barcelo Hotels and mileage required for award stays varies by location and category of hotel. When we checked, participating hotels in Toronto offered free award nights between 11,500 and 24,000 miles. Car rental awards are available with National, Hertz or Avis from 5,000 miles.

Aeroplan has over 400 Aeroplan Rewards that include gourmet getaways, electronics, entertainment, sports events and spa packages. Members can redeem miles for items such as 6,000 miles for a Gap or Pier 1 gift card or 627,000 miles for a Vespa LX50.

Members can also donate miles, and to date, a total of 37,755,252 miles have been donated to charitable organizations including Air Canada Kids' Horizons, Engineers Without Borders, Medecins Sans Frontieres and Veterinarians Without Borders. A minimum donation of 2,500 miles is required.

Partnerships

Aeroplan has a large number of partnerships and continues to add more. Members can rent cars with Avis and earn between 250 and 500 miles per rental. Rentals with Hertz earn between 50 miles for daily rentals and up to 5,000 miles for monthly rentals and with National, members earn three miles per dollar spent on eligible rentals.

Members can stay and earn miles at over 70 hotels and resorts with mileage offers ranging between one to three miles per dollar spent and 250 to 1,000 miles per stay. Miles can also be earned for vacations with Celebrity Cruises and Royal Caribbean International at the rate of 200 miles per night.

Aeroplan is partners with a few financial and insurance providers and members can earn miles for car and home insurance. Grey Power, belairdirect insurance, ING and ING Novex all offer one mile for every CAD$2 spent. The program also partners with Sun Life Assurance Company of Canada and members can earn 360 miles per year and 500 miles upon initial payment. Miles can also be earned for obtaining a mortgage with CIBC AeroMortgage, buying or selling a house through All-Purpose Realty referral, opening a Canadian Scholarship Trust Plan RESP and using Atlas Van Lines.

Signing up for phone service, buying gas and purchasing products at the pharmacy and hardware store are all Aeroplan mileage-earning activities. Members earn one mile for every dollar spent on Bell phone services or at Uniprix pharmacy, every three dollars spent at Esso and every two dollars spent at Home Hardware, Home Building Centre, Home Hardware Building Centre and Home Furniture. Members can also earn between 250 and 500 miles for selected airport parking, including Park'N Fly and Park & Jet Calgary. Aeroplan occasionally has limited time partnerships and until Dec. 31, 2007, Canadian residents are eligible to earn 10 miles for purchasing specially-marked Quaker or Tropicana products. Aeroplan does not have an online shopping mall.

Elite level program

Aeroplan offers three elite levels: Prestige, Elite and Super Elite. The Prestige status is reached at 25,000 miles or 25 flight segments; Elite at 35,000 miles or 50 segments and Super Elite at 100,000 miles or 100 segments. Elite qualifying miles are miles earned on Air Canada (except for flights booked on Tango fares or in X booking class) and Star Alliance partner airlines. The 100 segment threshold for Super Elite is new for 2007, up from 95, and more closely matches the segment requirements of other programs.

Unlike most elite programs, Aeroplan continues to offer threshold bonuses of 1,500 miles when obtaining Prestige, 2,500 for Elite and 5,000 for Super Elite status. Instead of dictating what members will find most valuable, Aeroplan members are able to customize their elite membership by selecting some of their benefits from a range of options. The benefits vary by elite level and choices include status miles bonuses, bonus miles on selected flights (100 percent, 50 percent or 25 percent, depending on elite level), upgrade certificates and complimentary lounge access for guests.

In addition to chosen benefits, Aeroplan also offers perks elite members expect to receive, such as status upgrade certificates, priority contacts, preferred seat selection, priority waitlist, check-in and standby for Prestige members. Prestige members also receive discounted lounge membership and Star Alliance Silver benefits.

Elite status members are given all of the benefits listed above as well as personalized luggage tags, priority baggage handling and an extra baggage allowance, priority boarding, complimentary Maple Leaf lounge access, special access to award seats and Star Alliance Gold benefits. Super Elites also receive concierge service, guaranteed reservations for full-fare tickets, discounts on companion awards and exclusive threshold bonus gifts such as bonus miles or gift certificates at the 150,000, 200,000, 250,000 and 300,000 Air Canada Status Mile levels.

Rules

Beginning July 1, 2007, miles will expire in accounts with no earning or redeeming activity for 12 months. The new policy will replace the current three-year expiration policy. Accumulated miles will expire seven years after the accumulation date but accounts belonging to members under the age of 18 are exempt from the new policy. Expired miles may be reinstated for a fee of CAD$30 plus CAD$0.01 per mile reinstated (plus taxes). Reinstated miles are valid for seven years from the date of reinstatement as long as there is annual account activity.

A maximum of 15,000 miles may be purchased each year for an ongoing promotional rate of CAD$0.03 per mile (regular price is $0.04). Miles can also be transferred through the aeroplan.com Web site only for CAD$0.02 per mile with a minimum transfer of 1,000 miles. Members are also charged a fuel surcharge on award tickets.

Service and support

Aeroplan staff tends to be friendly and helpful. Getting through to the service center is quick and the Aeroplan staff members we talked to were knowledgeable about the program and Aeroplan members have given us similar feedback. Members can also send questions to the service center via e-mail.

Online service

We've heard quite a few complaints about the functionality and availability of the Web site. Information can be hard to find and some pages take a while to load so browsing through the site can be slow going. Like many airlines, online bookings do not show all possible destinations and itineraries and booking a flight through the reservation center costs CAD$30 per passenger, plus any additional taxes. Star Alliance partner airline award flights can be found and booked online but only for basic itineraries and for some Star Alliance airline bookings, members must complete the reservation by calling the Aeroplan service center within 24 hours; a call center booking fee will not be charged. Changes to award tickets once they are booked must be made through the member service center for a CAD$55 fee plus applicable taxes.

Requests for missing Air Canada flight mileage can be made online but requests for missing mileage on partner airlines must be made through the member service center. Mile redemptions for hotel and car rentals, activities and merchandise and donations can all be made online. Members can also buy and transfer miles online and update their address and profile information.

Some other points to note...

Aeroplan has a long list of partners who offer many opportunities for earning and redeeming miles. Being a Star Alliance member increases the number of worldwide flight destinations for members and many of the Star Alliance partner flights can be found and booked online. Aeroplan continues to offer threshold bonuses to elite members and elite members can choose from a list of benefits and decide which features are most valuable to them.
Aeroplan's fuel surcharges on award tickets continue to be unpopular and members have complained that a "free" ticket can cost hundreds of dollars. Aeroplan is following the recent trend of shortening mileage expiration policies but one year is one of the shortest spans around and adding a shelf life of seven years to miles earned will not be popular with active members wanting to save miles to spend in their golden years. While many airlines charge a booking fee for reservations made through the call center, Aeroplan's charge is higher than most airlines and partner airlines can be booked online, but not all itineraries are available and sometimes a call to the service center is required.