What Does Your Credit Card Cover When Renting A Car?
When renting a car it is easy to find very cheap rates for daily use. Some car rental companies charge as little as $25 a day for their vehicles. This is a great way to save miles on your vehicle if you are planning a trip somewhere or if you just need a vehicle for a short amount of time. No matter what you are renting a car for, the question will come up as to whether or not you want to add on car rental insurance.
Car rental insurance can be quite expensive typically costing almost as much as the rental price per day. It can be a bit confusing when trying to decide whether or not you need to purchase this policy. You want to make sure that you are covered if anything happens, but you also do not want to pay that much extra for something that you may not need.
Car Rental Insurance and your Credit Card
One of the biggest questions that come up when considering rental insurance for a car is whether or not your credit card will provide you with free coverage for the rental. Most people are skeptical of the terms of this “insurance” as no one wants a minor accident in their cheap rental to turn into a big problem.
According to WalletHub’s study on credit card rental vehicle insurance it is true that you can get insurance coverage through the credit card that you use to rent a vehicle with. All of the major credit card companies in the United States, American Express, Discover, Visa, and MasterCard, provide some type of free car rental insurance. The only major credit card company that does not offer this free rental car insurance with all of their cards is MasterCard.
Eligibility Rules for Credit Card Rental Car Insurance
Across the four major credit card networks there are some rules that apply in order to be eligible for complimentary car rental insurance. The first requirement is that the entire rental must be charged on the credit card. In addition you will need to decline the collision damage waivers and supplemental liability insurance coverage that is offered by the car rental company.
None of the credit card companies will provide insurance coverage for renting expensive, antique, or otherwise exotic vehicles. They also will not provide coverage for off road or recreational vehicles. If you are renting a car internationally there may be some restrictions as well so make sure that you check with your credit card company before renting a car in another country.
What You Should Know about Credit Card Car Rental Coverage
When you are renting a car and relying on your credit card for insurance coverage there are a few things that you should know about the type of coverage that is offered.
First, credit cards will only supply a secondary insurance policy. This means that the coverage only pays for certain damages that are not covered by your primary car insurance company.
Second, if the card is in your name you will have to book the rental car in your name using the credit card issued to you in order to receive the rental car insurance coverage. It is not enough to simply have a credit card on you that offer this type of coverage.
Car rental insurance is typically only available for consumer credit cards. There are some business credit cards that do provide rental car insurance, but the coverage levels are typically quite different than what they are for a consumer credit card.
You should always check with your credit card first before considering using the card for the car rental and relying on the insurance provided. You will want to see how much coverage is offered because some credit cards do not offer this type of coverage at all and other cards have terms that are different from the standard. Look over the benefits statement on your card or call your bank to learn more about the specific benefits that are offered by your card.
Currently American Express is the only credit card company that provides users with an option for premium coverage in exchange for a fee. Secondary coverage is free for up to $50,000, but primary coverage is available with a higher limit as well as protection against property damage and injury if you choose this option.
The lowest amount of coverage is offered by Discover. There are only a few cards that have this coverage available and the company only provides collision damage for up to $25,000 and no loss of use fees are covered.
MasterCard limits its coverage to rentals that are 15 days or fewer and is only available on a few select cards. Visa has the best car rental insurance and it is offered on all of their cards.