Credit Card Rental Car Insurance Coverage Can Pick Up Where Traditional Insurance Coverage Stops

Rental Car Insurance from your credit card can help you out, but many limitations may leave you wondering if it's even worth it

Car Key in Hand / Your Credit Card's Car Rental Insurance Doesn't Cover as Much as You Think
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February 16, 2018

Credit cards typically offer perks to get you to sign up, like cash back and rewards. But you, like many people, probably don't know that many credit cards also offer free rental car insurance. This rental insurance kicks in automatically so long as you use that particular credit card to pay for the rental.

credit card rental car insurance doesn't cover much

Credit card rental car insurance may sound like a great perk, but it really doesn't provide that much coverage. In fact, you should think of it as secondary car insurance since it typically covers fee and costs that your primary insurance does not cover. Of course, each credit card is different and some have different levels of coverage. But they all fall short.

Credit Card rental car insurance may serve as primary insurance

Credit card rental insurance coverage alone might not cut it. Some rental car agencies will require you to have a primary insurance company first. But if you don't have insurance and need to rent a car, you may be able to use your credit card insurance as your primary. This will vary by rental car agency and will depend upon the type of coverage offered by your credit card. So don't assume anything until you check with the rental car agency.

where do I file a claim?

If you have both your primary insurance and credit card coverage and need to file a claim, you typically have to go through your primary insurance company first. This is because credit card insurance is considered secondary (unless you are able to use it as primary) and won't pay anything until your primary insurance has paid its part. When you file with your insurance company, your premium may go up. So don't think that credit card protections will save you from a premium hike.

some credit cards offer primary rental insurance coverage

A few credit cards offer primary rental car insurance coverage. If that's the case, you should use it as your primary insurance when you book your rental car to avoid premium hikes if you do have a claim. Some companies offering primary rental car insurance include Chase Sapphire Preferred, Chase Sapphire Reserve, United MileagePlus Explorer, United MileagePlus Club, Ritz-Carlton Visa Infinite and the JP Morgan Reserve card.

A lot of business credit cards offer primary coverage, but you have to use the card for business. You may have to enroll in this coverage, in which case you'll end up paying a flat fee per rental. This can come in handy if you have a long-term rental and don't want to pay for the rental company's coverage.

will my credit card cover me?

Most credit cards have requirements that you must do before coverage kicks in. Those requirements typically include:

  • Declining rental car agency's collision damage waiver (CDW/LDW).
  • Being the primary renter/driver of the car.
  • Pay for the rental in full with the card providing the protection.

what is included with credit card rental insurance coverage

Credit card rental car insurance typically covers collision damage and theft. Even though they have a bunch of limitations, they can pick up where your insurance company stops. It could pick up some or all of your deductible, towing expenses and other fees.

credit card rental insurance coverage limitations

  • Some credit card coverage only covers collision, not personal injury or personal liability.
  • Some vehicles, such as trucks, vans, and exotic cars, may not be covered.
  • You might have to rental for a minimum time period before coverage kicks in.
  • You might have a maximum number of days you can rent in order to have coverage.
  • Car-sharing services are usually not covered.
  • If you are sued as a result of a crash, you can forget about getting any help from the credit card.
  • Coverage typically doesn't extend for ambulance expenses or medical expenses.
  • Credit card insurance may not cover you in certain tourist destinations, including Australia, Italy, New Zealand, Ireland, Israel, and Jamaica.
  • Credit card insurance typically doesn't cover extras, such as roadside assistance, unless explicitly stated.
  • If the rental car company charges you a "diminution of value" fee after a wreck, credit card insurance usually won't cover it. In fact, they typically don't cover most rental fees.

it's all in the terms

Fine print is tricky and credit card companies are experts at creating fine print. So you should always read your credit card's terms and conditions to find out what the rental insurance covers, or whether the card offers it in the first place. There might also be special limitations on how and when to make a claim. You should considering getting the credit card's entire rental car insurance coverage rules in writing before renting.

Should I just get coverage from the rental car agency?

If your credit card doesn't offer coverage, doesn't offer good coverage, or it's just too confusing to figure out, you might want to purchase coverage directly from the rental car agency. You might also consider this coverage if you are renting a car and don't have insurance.

Avoiding unfair rental car damage charges

You might find yourself in a situation where you're facing charges for damage that you didn't make. Do you know what you should do?

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