Travel often? Tired of paying extra for your rental carâs insurance? If you can find the right credit card, you may be able to skip forking over cash for a rental car companyâs coverage.
Included as a benefit on many travel cards, credit card car rental insurance can cover your rental car in case of damage. This means that if you book your rental through your card, you can decline any coverage offered by the rental car company.
Of course, not all credit card insurance is created equal. Plus, using your card in lieu of a rental car company waiver comes with its own set of headaches. To help you along, this guide is meant to give you insight into the nitty-gritty of credit card car rental insurance.
In some cases, business owners may need to opt for a personal card to receive proper car rental insurance while earning rewards that match their spending habits. This isnât a bad thing; personal cards can still work great for business expenses.
How Credit Card Car Rental Insurance Works
Car rental insurance is a benefit provided by numerous credit cards (especially those marketed as travel cards). Depending on the card, this benefit can act as primary or secondary insurance in case you are involved in a crash with a rental car. As is the case with most things surrounding credit cards, youâll need to check with your cardâs terms and benefits to see exactly what coverage you have.
As long as you have a credit card with solid car rental coverage, youâll be able to decline the rental car companyâs collision damage waiver (CDW) or loss damage waiver (LDW). This can save you moneyâitâs not unheard of for a waiver to cost as much as $30 per day.
If you are using a business credit card note that youâll likely need to be using the rental car for business purposes for the credit cardâs insurance to kick in.
Primary Insurance VS Secondary Insurance
Some credit cards will offer primary insurance, while others offer secondary insurances. Whatâs the difference?
Primary insurance: If your card offers primary insurance, then it can replace any other insurance you might have. By having a card with primary insurance, youâll be able to decline a CDW or LDW when the rental car associate asks you.
Cards known to come with primary car rental insurance include Chase Sapphire Preferred and Reserve, United MileagePlus Explorer and MileagePlus Club, Ritz-Carlton Visa Infinite, and the J.P. Morgan Reserve Card. Overall, there are fewer cards on the market that offer primary insurance for rental cars (compared to those with secondary insurance).
Secondary insurance: For those with secondary insurance on their card, your cardâs insurance will only activate after youâve gone through another insurance. This means youâll need to file a claim with a different insurance first (such as with your primary driving insurance, or the rental car companies).
Note that in some cases, if your card advertises secondary insurance, but you donât have primary insurance (for instance, if you donât own a car) the cardâs insurance will become your primary insurance on a rental car. Before declining the rental companyâs waiver, however, contact your issuer to make sure this option is available.
What Car Rental Insurance Typically Covers
Generally, your credit cardâs car rental insurance wonât cover damage to property outside the rental car, injury to others, and potential lawsuits. Additionally, you likely wonât be covered if your belongings are stolen from inside the car, nor if you have to pay ambulance bills. Of course, some of these situations may be covered by your normal car insurance, your health insurance, or your homeowner’s insurance.
In most cases, credit cards neglect covering rented luxury cars. However, there are a couple of exceptions. Chase Sapphire Preferred and Reserve holders can receive coverage for âselected modelsâ of BMW, Cadillac, Lincoln, and Mercedes-Benz. Citi also offers a few cards that simply cover up to $100,000 worth of damage to road-worthy four-wheeled vehiclesâregardless of make or model. American Express also provides a premium protection program that covers pickups, vans, sport-utility vehicles, and luxury vehicles valued above $50,000.
You also may be unable to utilize a cardâs insurance on car-sharing services like ZipCar or car2go. Instead, youâll probably only be covered on rentals via traditional car rental companies. To see if your card covers car-sharing services, check with your issuer.
Additionally, some credit cards do not provide coverage outside the United States. Other cards do, but they may exclude certain countries. Commonly excluded countries include Israel, Ireland, and Jamaica. Youâll need to confirm with your issuer to check if the country youâre visiting is included in your cardâs coverage.
In some cases, you may also not receive coverage if you book your car rental completely on points. If this is the case, you may need to pay with your card for at least one day to trigger coverage. Note that Chase is an exception to this; booking through Chase Ultimate Rewards while using points obtained from either Sapphire Preferred or Reserve still qualifies for rental insurance coverage.
Finally, some cards wonât cover car rentals that last longer than 31 days. There are also some that only cover up to two weeks. If you are planning to rent a car long-term, youâll likely need to end the rental within your cardâs insurance window. Then you can start a new rental.
How To Check If Your Credit Card Has Car Rental Insurance
If you are unsure if your credit card has car rental coverage, the easiest way to check is by reading through your cardâs terms and benefits. If you do not have an up-to-date copy of your terms and benefits, contact your issuer to get a new version sent to you. You may also be able to access a digital copy through your credit cardâs online portal.
You can also call your cardâs customer service line and ask your representative if your card has car rental insurance and what that insurance covers.
How To Use Your Credit Cardâs Car Rental Insurance
While using your credit card for car rental insurance may save you money, it doesnât come without its own set of hassles. Those looking for simplicity might want to sign the rental car companyâs waiver instead. Hereâs a look at what using your cardâs insurance may entail:
How To Apply Insurance To Your Rental
After youâve confirmed that your credit card offers car rental insurance, youâll usually need to book the rental with your card. Once you do that, youâll then need to decline the rental car companyâs CDW or LDW.
In some cases, rental companies require proof that your card offers insurance. If this is the case, it may be handy to print out a copy of your cardâs terms and benefits that you can show the rental car associate.
You also must make sure that all potential drivers of the car are listed on the rental agreement. This is especially true of the driver at the time of the accidentâyour issuer may void the insurance coverage if a different person is behind the wheel.
How To File A Claim
Processes vary from issuer to issuer, so youâll need to contact your cardâs issuer to find out what youâll need to submit a claim and how. In most cases, youâll be asked to share documents related to the rental car and any damage sustained. These documents could include an accident report, a police report, a rental agreement, repair estimates, and photographs.
If you book a rental car with the right credit card, you may be able to save lots of money while still receiving proper collision coverage. This means you can travel without worrying about spending money on unnecessary expenses. With plenty of credit cards to choose from, youâll likely be able to find one that matches your spending habits, too.
Curious which cards are best overall for travel? Check out the Merchant Maverick article on the best business credit cards for travel perks.
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