Rental Car Insurance Options from Credit Cards

[audreyh1]

I was reviewing rental car insurance options recently, and I came across some interesting information.

Many credit cards provide rental car collision damage waiver coverage as long as you have declined it from the rental company. But this is usually offered as secondary insurance, meaning you have to file a claim with your insurance company first, and then the credit card insurance will cover things not covered by your auto insurance company such as your deductible .

However - there are several cards out there that provide this rental car insurance as primary insurance. This means you don't have to get your auto insurance company involved - you can just go straight to the credit card company and let them handle it. Fortunately, I have one of these credit cards, and I will use it next time I rent a car.

If you don't have a credit card that provides primary insurance, but you have an American Express card, you can buy primary insurance coverage for an extra flat fee per rental. It provides some medical coverage as well.

Another point - if you don't carry collision insurance on your personal car(s) at home, then the secondary credit card collision damage waiver insurance becomes the primary insurance.

Of course you have to charge the rental to the credit card for the insurance to be in force. And there are time limits in terms of number of rental days, and some credit cards won't cover certain car models.

Here is an article that discusses cards that provide primary insurance for rentals cars. Credit Cards That Offer Primary Car Rental Coverage

 

[pb4uski]

I was golfing with a friend yesterday who is a retired insurance adjuster and this topic came up because another friend's son was renting a car. While I understood that collision would be covered I mention that would not cover any loss of use claim by the car rental company and he said that would be covered by your liability coverage. New to me but sort of makes sense.

 

[audreyh1]

I was golfing with a friend yesterday who is a retired insurance adjuster and this topic came up because another friend's son was renting a car. While I understood that collision would be covered I mention that would not cover any loss of use claim by the car rental company and he said that would be covered by your liability coverage. New to me but sort of makes sense.

Some states require rental car loss of use to be covered by your auto insurance policy. TX is one of them.

Many credit card companies do cover loss of use. Whether the rental car company cooperates with what the credit card insurance company wants is another matter. This is a controversial area, but apparently usually gets resolved ..... eventually.

 

[rdy2go]

One of the fears many have is that while you are getting an accident sorted out, the rental company will tie up your credit card limit with a large charge to your credit card.

 

[samclem]

If you don't have a credit card that provides primary insurance, but you have an American Express card, you can buy primary insurance coverage for an extra flat fee per rental. It provides some medical coverage as well.
http://thepointsguy.com/2015/07/credit-cards-that-offer-primary-car-rental-coverage/

I have used this AMEX primary insurance service before, and it can be very economical. IIRC, the fee was $20 per rental period, and the coverage was good. I used it frequently when I rented overseas. I never filed a claim so I can't speak firsthand about their actual service--I'm sure a claim would be more hassle than if one bought insurance from the rental car company (since there's another party involved), but the cost was a small fraction of the cost for the very expensive coverage bought at the counter.

 

[audreyh1]

One of the fears many have is that while you are getting an accident sorted out, the rental company will tie up your credit card limit with a large charge to your credit card.

Well, I guess you have to decide if it is worth paying an extra $30 a day, or $210 a week to avoid that scenario.

https://www.autoslash.com/blog-and-...w-to-avoid-getting-stuck-with-the-bill-for-it

Of the stories I have read where people were billed for repairs, loss-of-use and fees, etc., none of them had their credit card charged. Instead letters and bills were mailed to them. So this threat of having charges piling up on a credit card may simply be a tactic used at the rental counter to intimidate a customer into buying the CDW insurance.

 

[Jack_Pine]

How does the American express coverage work? Do you have to pay for the rental with that card? Do you then call AA to get it executed?

UhUo....have to get off this post count.......................

 

[samclem]

How does the American express coverage work? Do you have to pay for the rental with that card? Do you then call AA to get it executed?
.

When I did it: You sign up for the program (no charge), then when you use your AMEX card to rent a car, they add $20 to the bill and you are covered. It's been painless, the only "gotcha" for me is remembering to make a conscious decision about which card to use (AMEX when I wanted the coverage, a different card when I was okay with letting another card's secondary coverage provide the protection).

 

[brucethebroker]

As a aside....when I rented two weeks ago, the CSR at the counter told me about their great new benefit, roadside assistance. When I said that was nice, she handed me my rental agreement to sign. I noticed that it was $21 more than I was quoted online. I asked why.......she had added the RA without asking or telling me it was optional. I told her that was dishonest, and that I would never be back (smaller national company that I have used 3-4 times in the past). She told me she had been trained to just add it automatically.

 

[REWahoo]

As a aside....when I rented two weeks ago, the CSR at the counter told me about their great new benefit, roadside assistance. When I said that was nice, she handed me my rental agreement to sign. I noticed that it was $21 more than I was quoted online. I asked why.......she had added the RA without asking or telling me it was optional. I told her that was dishonest, and that I would never be back (smaller national company that I have used 3-4 times in the past). She told me she had been trained to just add it automatically.

Enterprise is my guess.

 

[audreyh1]

How does the American express coverage work? Do you have to pay for the rental with that card? Do you then call AA to get it executed?

UhUo....have to get off this post count.......................

Yes, you always have to use the card to pay for the rental to get coverage from a specific credit card.

To get the AMEX primary insurance coverage, you need to sign up for their program, and then you are automatically charged the fee when you rent a card with the card. It's like $18 or $25 for each rental period depending on what you have chosen and your state of residence.

Once you sign up, all your AMEX branded cards are in the program. Fidelity AMEX is not because that's not a "true" AMEX card - it doesn't provide the AMEX benefits, just the uses their network.

 

[Jack_Pine]

Thanks for the AA program info. that sounds like a good plan. I like the idea of coverage for a reasonable price and keeping it off my personal insurance if something happens.

 

[sengsational]

But this is usually offered as secondary insurance, meaning you have to file a claim with your insurance company first, and then the credit card insurance will cover things not covered by your auto insurance company such as your deductible.

My credit card's "Auto Rental CDW" fine-print says "In your country of residence, this benefit is supplemental to, and excess of, any valid and collectable insurance from any other source." So if I rent in other than the US, then doesn't this benefit become primary? My auto insurance is not even in force in the location I'm going to rent the car. Farther down, it says "this benefit is available in the United States and most foreign countries" (then lists a few countries where no benefit is provided). So that confirms that the benefit should be in force outside the US. For reference, I'm talking about a World Mastercard, and the benefits document is in this PDF.

 

[Corporateburnout]

Thanks for the AMEX info. I just signed up for it in case I ever need it.

 

[kaneohe]

Don't know if true or not but have been told a number of times by different individuals..............that you need to pay using the card of the primary renter/driver......with their name on the card even if both have the same number........to get the cc insurance.

 

[Fedup]

I have two credit cards that offer primary insurance overseas. Thanks to this threat. I got rid of all my American Express cards except for the Costco card, it will be cancelled this July or August.


Sent from my iPad using Early Retirement Forum

 

[audreyh1]

My credit card's "Auto Rental CDW" fine-print says "In your country of residence, this benefit is supplemental to, and excess of, any valid and collectable insurance from any other source." So if I rent in other than the US, then doesn't this benefit become primary? My auto insurance is not even in force in the location I'm going to rent the car. Farther down, it says "this benefit is available in the United States and most foreign countries" (then lists a few countries where no benefit is provided). So that confirms that the benefit should be in force outside the US. For reference, I'm talking about a World Mastercard, and the benefits document is in this PDF.

Yes, if you rent a car overseas, this becomes primary.

But you also need to make provision for liability insurance overseas.

And sometimes the rental car company in Europe, for example, requires you to buy their insurance which may void the credit card insurance, even though the car rental company has much higher deductibles. So it gets a little complicated.

Rick Steves has an article discussing that - https://www.ricksteves.com/travel-tips/transportation/car-rental-cdw

 

[braumeister]

Still, I have always been surprised at the way I get a better deal overseas than in the US.

Last year I rented a car from Avis in England for 11 days and it cost me less than the similar car I rented for 4 days in Oregon the previous month. Both rentals were without any Avis insurance coverages.

 

[Sunset]

One of the fears many have is that while you are getting an accident sorted out, the rental company will tie up your credit card limit with a large charge to your credit card.

So that is why you should have 2 or 3 credit cards, so you have a choice of which one to use if difficulties arise.

When I limited myself to 2 cards a long time ago, I learned to make one a Visa and the other Mastercard, as some places would not take one or the other.

 

[sengsational]

Rick Steves has an article discussing that - https://www.ricksteves.com/travel-tips/transportation/car-rental-cdw

Thanks for that link. I just requested a “Letter of Coverage” from my credit card customer service.

 

[Corporateburnout]

So that is why you should have 2 or 3 credit cards, so you have a choice of which one to use if difficulties arise.

When I limited myself to 2 cards a long time ago, I learned to make one a Visa and the other Mastercard, as some places would not take one or the other.

Our experience is that most places that accepts Visa will accept Mastercard but we always carry an AMEX, a Visa and a Mastercard at all times.

 

[JoeWras]

I think I may be straying from my LBYM roots.

Recently rented a car for 2 days. Bought the waiver for $26 total. Figured if anything (i.e. mostly small stuff like someone backing into me in a parking lot), I didn't have to mess with insurance and credit cards. I just didn't want to worry about hassle for such a small thing.

This is the first time I ever did this. Then again, it was just two days.

 

[fosterscik]

Timely thread for me. I'm about to rent a car in Italy for 3 days in May. Italy (and Ireland ) are special cases! Rick Steeves states:

If you’re renting in either Ireland or Italy you’ll have little choice but to buy the company’s CDW.

If I'm deciphering all of this correctly, Italy requires you to buy Collision damage insurance (but it's terrible with really high deductibles). It cannot be waived. Because the coverage is so poor, I believe I have little choice but to buy "super" CDW. Why? Credit card primary or secondary coverage is null and void if you accept any coverage from the rental car company. I've read the coverage statement for my Barclaycard premium CC and that is the way I interpret the statement:

How do I activate this benefit?
For the benefit to be in effect, you must:
• Initiate and complete the entire rental transaction with your eligible card, and
• Decline the auto rental company’s collision damage waiver (CDW/LDW) option,
or similar provision, if offered by the auto rental company.

So my choice appears to be:
1) take the minimal coverage and possible be on the hook for a few $k if I have an accident.
2) pay (~$30/day) for "super" CDW.
If anyone has any additional info (or can tell me I'm misreading all his, I'd appreciate a head's up.

 

[Bamaman]

Your own personal auto policy is primary for a rental car in most places. Check with your agent before your trip to verify if you are covered.

Some credit cards come with physical damage/comprehensive insurance on car rentals charged on their cards. That is secondary to your personal auto policy in most cases.

Rental car CDW coverage is third priority--after the above. But it is required by law in Italy and Ireland. Just about every auto insurance policy specifically excludes a number of countries--many of which are in Eastern Europe and political hot spots.

What's so ridiculous is that most large rental car companies don't even carry any physical damage and comprehensive insurance on their cars. They claim they're "self insured." The CDW is essentially a pot of money they pay for damages out of, and it's another profit department to them.

 

[ExFlyBoy5]

Timely thread for me. I'm about to rent a car in Italy for 3 days in May. Italy (and Ireland ) are special cases! Rick Steeves states:

If I'm deciphering all of this correctly, Italy requires you to buy Collision damage insurance (but it's terrible with really high deductibles). It cannot be waived. Because the coverage is so poor, I believe I have little choice but to buy "super" CDW. Why? Credit card primary or secondary coverage is null and void if you accept any coverage from the rental car company. I've read the coverage statement for my Barclaycard premium CC and that is the way I interpret the statement:

So my choice appears to be:
1) take the minimal coverage and possible be on the hook for a few $k if I have an accident.
2) pay (~$30/day) for "super" CDW.
If anyone has any additional info (or can tell me I'm misreading all his, I'd appreciate a head's up.

Have you been to Italy? In my opinion, they are the worst drivers I have ever seen in the world...and I have seen quite a bit. I personally would not rent a car in Italy...way too risky for me!

Sent via mobile device. Please excuse any grammatical errors.