I was planning to purchase a domain on namecheap (using a foreign card), but then I came across premium DNS, which offers "100% DNS uptime" for a fee.
I'm curious, is it common to experience uptime issues without this service? Has anyone here had any experience using it?

We did not encounter any issues.
When it comes to transferring to Cloudflare, there is generally no need to worry if you are only using their DNS services without the additional features. It is worth considering since their DNS is likely to be more advanced than this premium service.

Paid ("premium") DNS hosting offers more than just uptime; it provides additional features that are not available with free ("regular") DNS hosting. These features include:

1.

"Failover" - the service monitors the availability of your site/application and can automatically switch to another pre-specified IP if it's unavailable. This is particularly useful if you have a backup server in place.

2.

Support for DNSSEC, ensuring enhanced security for your domain.

3.

Compatibility with specific DNS records such as TLSA, S MIME A, OPENPGPKEY, SRV, HINFO, LOC, RP, SSHFP, and many more.

Investing in premium DNS hosting unlocks these bonuses and empowers you with greater control and versatility for managing your online presence.

There is no guarantee of 100% uptime with free DNS hosting.
However, even with Premium DNS, it is important to carefully read the Terms of Service.

In my experience, there was only one instance where the free nameservers experienced a brief outage.

Opting for Premium DNS is recommended if you require features like DNSSEC and IP anycast. However, it's worth noting that claims of DDoS protection should be examined critically since some providers may simply disable your service or require payment if request limits are exceeded.

The idea that you need to pay for "100% DNS uptime" is a bit of a marketing gimmick. Most reputable providers offer decent uptime without extra fees. It's essential to understand that while premium DNS can provide enhanced features like load balancing and faster propagation, the average user might not need these.

If you're running a small blog or personal project, standard DNS should suffice. Premium services can feel like an unnecessary cost unless you're operating at scale.