Credit Card Car Rental Insurance
Does my credit card cover rental car insurance?
There are number of misconceptions floating around out there about rental car insurance credit card coverage. In fact, from my experience most don’t understand how it works exactly. I will go over the details but always check with your credit card company before renting to confirm… as we all know “terms and conditions are subject to change.”
How it works…
First of all it’s important to note that in order to qualify, you will have to decline the rental car company’s insurance and pay for the rental in full using your applicable credit card. This credit card car rental insurance is secondary; meaning that it only pays out what your primary auto insurance doesn’t cover. Usually that means they will pay the deductible on your personal car insurance. What if you don’t have regular car insurance? Then typically, but not always, the credit card coverage will kick in right away for the very first dollar in damage.
What’s covered…
Coverage varies by card (which we will discuss more in a moment) but typically it only applies to damage resulting from collision. That means if you get in an accident, it’s probably covered. But if someone keys your car, you might be stuck paying for it (if you don’t have primary insurance which covers it).
Vehicle exclusions…
If you’re renting a Taurus or a Camry, then you should be okay. But anything other than your run-of-the-mill passenger car and you may not be covered. For example, pickup trucks are never covered. Exotic and luxury cars, antique vehicles, full size vans, motorcycles, and some SUVs are not covered. So to play it safe, rent a basic car and always double check with your card issuer to make sure.
Let’s take a look at typical credit card car rental insurance coverage. Please note this information may be outdated and incorrect, so you will definitely need to check with your credit card company before renting to know for sure:
American Express
Cards: all American Express credit cards and charge cards
Duration: up to 30 days
Amount of Coverage: varies by card, the charge cards (Gold, Platinum, Centurion) seem to offer the most
Excluded Countries: Jamaica, New Zealand, Australia, Israel, Ireland, Italy. If you have a small business American Express, coverage is only applicable for rentals in the United States.
Discover
Cards: all Discover credit cards except for student versions
Duration: up to 31 days
Amount of Coverage: up to $25,000
Excluded Countries: none, as long as rental car company in that country allowed you to pay for the rental in full using your Discover card
Visa
Cards: all Visa credit cards included
Duration: up to 15 days in your country, up to 31 days when renting outside of your home country
Amount of Coverage: up to the actual cash value of most rental eligible cars
Excluded Countries: Ireland, Northern Ireland, Israel, Jamaica
MasterCard
Cards: only included on MasterCard Gold, Platinum, World, World Elite credit cards
Duration: 15 days for Gold and Platinum, 31 days on World and World Elite
Amount of Coverage: whichever is less: $50,000 per accident, current market value, actual repair costs
Excluded Countries: none for MasterCard World and World Elite, for Gold and Platinum the exclusions are Ireland, Israel, Jamaica, and where it is not permitted by law.
The fine print…
As you can imagine, all of these credit card car rental insurance policies come with loads of fine print. Be on the lookout for fees which are not covered. For example, most will cover “reasonable towing” fees, however loss-of-use fees (while the car is being repaired or replaced) may not be covered if the rental company doesn’t provide your credit card company with proper documentation. “Administrative fees” with MasterCard are not covered. Discover cards don’t cover any of these fees whatsoever.
Other exclusions…
If you didn’t pay for the rental car in full with the credit card, you definitely won’t be covered. Driving while you are under the influence will most likely invalidate your car rental insurance benefit, too. Vandalism is rarely ever covered and theft of vehicle isn’t always included. Be sure and check to see which driver(s) will be covered. There may be other exclusions depending on the issuer.
Does it really protect you?
As you can see, there are quite a few loopholes and fine print which create gaps in coverage. This is why it’s so important to check with your rental car credit card insurance policy (and not rely on this article) to determine the exact coverage you have.
My personal recommendations
If you don’t have comprehensive insurance on your own car, then I would definitely be skeptical of these secondary insurance coverage policies that credit cards offer. Unfortunately rental companies charge anywhere from $20 to $25 (plus tax!) for each day of insurance coverage if you buy it from them.
My first recommendation would be to get primary credit card car rental insurance. For 2013, this is included on the credit card from United Airlines (and it has excellent rewards, too!).
My second recommendation would be if you have an American Express, you can buy optional primary insurance for $24.95 per rental from AmEx directly. That basically means if you’re renting a car for longer than a day, it’s probably cheaper to get it through your AmEx card. The other added benefit is that it is for primary coverage (not secondary) so if you back up into a concrete post, you won’t have to worry about the vehicle repair claim negatively impacting your regular insurance history, since it won’t be reported to them (as long as the cost of the claim doesn’t exceed your AmEx rental coverage). Don’t have an AmEx card to do this? Then I recommend you check out the highly rewarding no annual fee AmEx Blue.
I applaud all these great tips on rental car insurance. From the original author to the twenty years experienced insurance rep and those that are currently going through claims currently. I gotta tell ya’, all the times i second guessed my self ‘why have I purchased full coverage every day of the rental,’ well I realize it was worth every penny based on some of these horror stories I’ve read from you guys. Thanks for reassurance or reinsurance?? LOL Nice.
I wanted to thank you for this valuable info!
I notice that CreditCardForum made no attempt to answer a single issue raised here – good article, but disappointing lack of response.
I recently had a hit and run on my Enterprise rental car, I was required to pay Enterprise my deductible of $1000.00 it took them over a month to process the claim and come back with the total damages which were around $500, Mastercard took 5 days to process the required documents and issue me a refund for the damages that I paid. Kudos to Mastercard.
Loss of use and administrative are usually waived depending on the relationship between the rental car company and your automobile insurance. Make sure that you file a claim with BOTH your CC company and your auto insurance. If your CC company picks up the tab and your insurance company does not pay a dime then your premiums will not go up. In my case Enterprise/Progressive have an arrangement not to bill loss of use/administrative fees to any Progressive customer and Mastercard picked up the tab for the actual damages
Hey guys, just had to make a comment! Working for a rental car company for the last 20 plus years, I have to say there are so many loop holes in the system of car rental insurance….I do want to inform everyone that most of the time when you call up your insurance provider and say hey “im renting a car”, am I covered? They usually say yes…….Red flag!!!!
They never said what state are you in, what size car, how many days, how many passengers, etc.(and they certainly don’t tell you that you’re insurance will go sky high if you make a claim): they just want you to continue being a customer of the insurance agency.
Also the credit card company is not always dependable (You have to meet a strict criteria). So, moral of the story READ ALL THE FINE PRINT! I’ve watched several people pay the full cash value of a car out of pocket, because they misread the fine print (sounds scary, but it’s the truth).
All great points. I have to admit that I’m extremely irritated every time I get a rental and get asked all the questions about what insurance I want. This really gets you to thinking.
Is it legal for a car rental agency to make a copy of your credit card to keep on file? Do you have to give them a copy if they ask for it? I don’t think this is right for any company to ask for a copy of your credit card. Seems illegal to me.
I think it’s mandatory to have a credit card when renting a car?
I rented a car in Alamo with my American Express, I denied rental car insurance because of American Express, so far everything is running OK. I had an accident and am just waiting to see how everything goes on, when i have any update I will post it.
Hi Enrique – How did it go with American Express, am in a similar situation of renting at Avis with American Express card.
Thanks for the helpful tips!
I’m actually going through a claim right now. The funny thing is that we were supposed to get charged for the car rental on the Mastercard that covers damages. However, we were never actually charged! It seems as if the car rental has in their system that we paid, however it isn’t showing up on the credit card statement. If they can’t find it, do you think my claim will get declined because I was never charged?
Note that Mastercard Platinum will not cover the deductible on a rental car that a car dealer provided you free while your car is in the shop for warranty work. You have to actually pay for the rental car yourself in my case from Hertz.
Who would have known this?!
So when I was hit on the freeway by an idiot who took off I had to file claim under my personal insurance AND I am responsible for the deductible and who knows about the loss of use thing. I will always buy that extra insurance the rental car companies offer in this situation. In California and apparently only California, a hit and run is always a collision claim and whatever your deductible is on your personal car applies to the rental car.
Why is a World Master Card acceptable in Ireland for rental car insurance but not a regular Master Card?
Great info, this teaches anyone not to pay in any other way than credit when it comes to car rentals! Hopefully more people see this
It makes sense when you don’t have a primary coverage that everybody is trying to avoid covering you when you rent a car, simply because they think you don’t have the car owner experience in caring about the car, driving safely (and driving experience in general). That’s why they have these fine prints and time frames for responses to claims.
Sad true, but we got to try to understand the “others”. They insure you with the hopes that you know what you’re doing, and trying to minimize their liability for other drivers mistakes.
Thanks for sharing.
I was just rejected for my claim of a $500 scratch by the Continental MC hyped in a link above. Why? The claim was late. I was out of the country for a few months, and didn’t even know the rental car agency was making a claim against me.
Given the amount of paperwork and details required and legal clauses and qualifiers, it seems to me that the whole process is a charade and is only designed to look for ways to reject the claim.
Has anyone actually received this benefit? Is this coverage subject to any sort of regulatory oversight?
I work for an adjustment company and we process damage claims for all the rental car companies. I see these claims paid all the time. You just need to supply them the information they need and make sure to have used the credit card to purchase the entire rental. Usually they send the check directly to the card holder, and then they cash the check and never pay for the damages. Lol…I see this all the time.
Thanks for writing this, because I think the credit card companies should do a better job explaining how their rental insurance works. I suppose ultimately I’m at fault if I don’t read the benefits but still, it would at least be nice if they made it more prominent.
Very helpful insight on how these rental programs work on credit cards. Hmm, maybe I will just buy the darn insurance from the rental company next time after seeing what might not be covered on my basic Visa Gold!
Do not count on your credit card to even pay the deductible. According to American Express, all damage to rental cars falls under liability for which you have no deductible. Since they only pay the deductible, you get nothing! The whole thing is up to you and your personal insurance. Also, they can charge anything they want. If you rented a car, it is more than likely that you were not in your city of residence. Unless you want to go back to their location numerous times, you have no choice but to pay. Moral: Don’t use American Express.
Connie, you are exactly correct! I am going through this right now. I will have to pay for the damage to the rental car while parked in a hotel parking lot because Amex says it is a liability claim. And AMEX doesn’t pay because there is no deductible. So, since I don’t want my car insurance rate to go sky high by filing a 700.00 claim, I am stuck! I always felt insured by Amex and always made sure to use my Amex with a rental car. People need to know they aren’t REALLY protected by AMEX, their own car insurance has to pay, and you are foolish to make a claim for a small amount because you will pay much more in higher premiums for filing claims.
Good to know this stuff. I always use my credit card to make sure i’m covered when renting.
Take care..the American Express coverage also will not pay for loss of use unless the rental car company agrees to provide them with their usage logs to help prove “loss of use” charges. The rental car companies consider these proprietary information and may not be willing to release.
Thanks for going into detail about how credit card car rental insurance really works. I had no idea there were this many loopholes! Now I’ll think twice when I rent a car.