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Rental Car Insurance: Which Credit Cards Have You Covered

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The question arises every time you rent a car: Do I really need rental car insurance?

Many rental agencies offer damage waivers for about $15 to $25 a day, selling peace of mind along with expanded coverage. But these waivers are often no better than the coverage you already have with your favorite credit card.

Depending on where you rent, the rental company’s liability for injury or property damage may be anywhere from $25,000 to $50,000. This could still leave a big bill for you to pay, but your credit card may also step in — sort of. All four major card networks offer rental insurance, but vary substantially in benefits and requirements.

In some cases, car-rental customers may want to purchase full coverage from the car-rental company to avoid the hassle of making a claim or reporting an accident to their primary insurer and the credit card issuer. Make sure you’re comfortable with that process before relying on your credit card’s secondary coverage.

You can also get primary coverage for your car rentals with these two credit cards:

Chase Sapphire Preferred Credit Card
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on Chase's
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The Chase Sapphire Preferred® Card is one of the Nerds’ favorite travel cards, so it helps that it offers primary rental car insurance at no extra cost. You’ll earn 2 Ultimate Rewards points per dollar spent on travel and dining and 1 point per dollar spent on everything else. Plus, the card has one of the most valuable sign-up bonuses on the market: Earn 40,000 bonus points when you spend $4,000 on purchases in the first 3 months from account opening.

It has an Introductory Annual Fee of $0 the first year, then $95 after that, and doesn’t charge a foreign transaction fee.

Chase United Airlines Mileage Plus Credit Card
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on Chase's
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If you’re a loyal United flyer and often rent cars, the United MileagePlus® Explorer Card might be the right choice for you. It offers 2 miles on every dollar spent on United flights and 1 point on all other purchases, plus a decent sign-up bonus: Start with 30,000 bonus miles after you spend $1,000 on purchases in the first 3 months.

The United MileagePlus® Explorer Card has a $0 intro annual fee for the first year, then $95 after that, and no foreign transaction fees. You’ll also get your first checked bag fee waived with cardmembership.

What to know about credit card rental coverage

Before we review the rental car insurance benefits offered by each network, you should know that:

  • Generally, your credit card offers secondary rental insurance. This means that it will only pay for the cost of certain damages not covered by your regular car insurance policy.
  • As the cardholder, you must book the rental car with your credit card under your name to receive coverage. Only carrying a card that offers rental car insurance isn’t sufficient.
  • Typically, you must refuse the coverage offered by the rental car agency to receive rental car insurance benefits from your credit card. We’ll discuss exceptions to this general rule below.
  • This article applies to consumer credit cards. While many business credit cards offer rental car insurance, coverage levels could be substantially different from the benefits described below.
  • Cards in the same network may have varying levels of coverage. Some issuers don’t offer rental car insurance at all, while others set terms that differ from the network standard. Call your bank or check your card’s benefits statement to learn more about your specific card’s benefits.

Nerd note: Much of the information discussed in this article is a compilation of resources available online. However, some of it was obtained through phone calls to customer service hotlines. It’s important to contact your card’s issuer to verify its  coverage policy before you rent a vehicle. Here are some important terms to know before you call:

  • Loss of use: The cost of renting another car while the original is out of commission.
  • Fully utilized:  Generally, this term describes when 80% of a rental company’s cars are in use.  A card network may cover loss of use only if the auto rental company’s fleet is “fully utilized.”
  • Diminished value: The amount that the rental car’s resale value decreases. This cost is usually relatively small, unless you manage to significantly damage the car without totaling it.
  • Antique cars: Usually defined as a car made at least 20 years ago or one that has been out of production for 10 years. All networks exclude coverage of such vehicles.
  • Vans: As a general rule, personal-use vans that seat eight people or fewer are covered. However, some waivers specifically exclude certain SUVs, and almost all exclude cargo vans.

Benefits by network

Visa, MasterCard, American Express and Discover all provide rental car insurance above and beyond what your primary insurer and rental company will offer. Here’s a quick overview of each network’s benefits and limitations:

Visa: Visa is often touted for its excellent rental car insurance benefits, mostly because it’s widely available for cardholders. Unlike many other networks, it offers rental car insurance on all of its cards — standard, Signature, rewards, the works. However, it limits its rental car coverage period to only 15 consecutive days domestically and 31 consecutive days abroad.

MasterCard: Its benefits are similar to Visa’s. However, rental car insurance is not offered on all cards, and it limits its coverage period on all rental cars to 15 consecutive days or fewer. According to customer service, it’s available only on Platinum, Gold, World and World Elite cards.

American Express: American Express is the only network to offer premium coverage for a small fee. It offers free secondary coverage up to $50,000 ($75,000 on The Platinum Card® from American Express and the Delta Reserve Credit Card), but will offer primary coverage with a higher limit and protection against injury and property damage if you choose it.

Discover: Discover’s coverage is limited to a handful of cards. Unlike the other three networks, Discover doesn’t cover loss of use fees, only collision damage up to a $25,000.

Network-by-network comparison

Visa and MasterCard

Both Visa and MasterCard emphasize that their terms vary by issuing bank. Again, check with your particular card’s issuer before renting your vehicle.

Benefit Visa MasterCard
Offered on All cards Gold, Platinum, World and World Elite
Rental period 15 consecutive days domestic/31 abroad 15 consecutive days
Must decline rental insurance? Yes Yes
Vehicle value Not specified $50,000 or less
Includes Physical damage, theft, loss of use*, towing Physical damage, theft, loss of use*, towing
Excludes Injury, liability, property damage, taxes, damage to other vehicles, diminished value, tire wear and tear
Primary or Secondary? Secondary Secondary
Drivers covered All authorized drivers
Vehicles excluded Expensive, exotic or antique cars, trucks, pickups, RVs, motorcycles, ATV’s, limousines and certain vans
Excluded countries Ireland, Northern Ireland, Israel, Jamaica Maybe Italy, New Zealand, Australia, Ireland, Israel, Jamaica (Contact your vehicle rental agency before traveling)
Excluded SUVs/vans Vans with more than 8 seats Sport utility trucks (i.e. Chevy Avalanche, GMC Envoy, etc.), full-size vans
Max coverage Not specified $50,000
Max loss of use* Not specified Not specified
Report/file claim within 45 days 30 days
Source Visa MasterCard benefits and a call to customer service

*To be compensated for loss of use, the rental company must prove that the fleet is “fully utilized.” Most rental agencies won’t bother, so your chances of getting this benefit aren’t very high.

American Express

American Express has various exemptions for students, Californians and Floridians, see below for the details.

Benefit AmEx Basic AmEx Platinum AmEx Premium
Offered on All cards The Platinum Card® from American Express and other Platinum-branded AmEx cards, Delta Reserve Credit Card All cardholders can purchase
Rental period 30 consecutive days from the same rental company, or 30 consecutive days out of a 45-day period within the same geographic location (75-mile radius) from any rental company 30 consecutive days from the same rental company, or 30 consecutive days out of a 45-day period within the same geographic location (75-mile radius) from any rental company 42 days (30 in Washington State)
Must decline rental insurance? Decline full coverage, can accept partial collision damage waiver
Vehicle value <$50,000 <$75,000 Not specified
Includes Physical damage, theft, towing, storage, loss of use Physical damage, theft, towing, storage, loss of use, certain medical expenses for accidental personal injury, AD&D, personal property Physical damage, theft, towing, storage, loss of use, certain medical expenses for accidental personal injury, AD&D, personal property
Excludes Injury, liability, property damage, diminished value, taxes, wear and tear
Primary or secondary? Secondary Secondary Primary (accidental personal injury and personal property benefits are secondary)
Drivers Covered All authorized drivers
Vehicles excluded Expensive, exotic or antique cars, trucks, pickups, cargo vans, custom vans, full-size vans, vehicles used for commercial purposes, antique cars, off-road vehicles, RVs, motorcycles, etc. Trucks, pickups, cube vans, box trucks, leased vehicles, customized vehicles, antique cars, limousines, off-road vehicles, motorcycles, RVs, etc.
Excluded countries Ireland, Israel, Jamaica, Australia, Italy, New Zealand
Excluded SUVs/vans Full-size sports utility vehicles (i.e. Chevy/GMC Suburban, Tahoe and Yukon, etc.), vans with more than 8 seats N/A
Max car coverage $50,000 $75,000 $24.95 plan: $100,000
Max medical expenses per person N/A $5,000 $24.95 plan: $15,000 per person,
Accidental death and dismemberment: $100,000
Max personal property damage or theft N/A $1,000/person, max $2,000 $24.95 plan: $5,000/person, $10,000 max
Max loss of use Not specified
Report/file claim within As soon as reasonably possible/60 days
Source AmEx AmEx AmEx

American Express Exemptions

Students: A Personal, Gold or Rewards Plus Gold cardholders who are enrolled in an accredited four-year college or graduate program in the United States, and are receiving student benefits provided by card membership, are ineligible.

California: Maximum coverage costs $17.95 for:

  • $100,000 car damage
  • $250,000 accidental death and dismemberment
  • $15,000/person medical expenses
  • $5,000/person property damage, maximum $10,000 overall

Florida: Property damage is capped at $15,000 per person, $25,000 overall.

Discover

Benefit Discover Discover Escape
Offered on Discover® Motiva Card, Discover® Open Road Card, Discover® More® Card Escape by Discover® Card
Rental period 31 days, 45 for employees using business credit card 31 days
Must decline rental insurance? Yes Yes
Vehicle value <$50,000 <$50,000
Includes Collision or upset only Physical damage, theft, towing
Excludes Theft, any damage not due to a collision, injury, liability, property damage, taxes, damages to other vehicles, wear and tear, loss of use Injury, liability, property damage, taxes, damage to other vehicles, diminished value, tire wear and tear
Primary or secondary? Secondary Primary (under certain conditions)
Drivers covered All authorized drivers
Vehicles excluded Expensive, exotic or antique cars, trucks, pickups, RVs, motorcycles, off-road vehicles, mini-buses
Excluded countries Valid in any country that accepts Discover Ireland, Israel, Jamaica, Australia, Italy, New Zealand
Exclude SUVs with more than Doesn’t specify seat exclusions, but doesn’t cover all vehicles Sports utility trucks, vans with more than 9 seats
Max coverage $25,000 $50,000
Max loss of use N/A N/A
Report/file claim within File claim in 90 days 30 days
Source Discover Discover


Image via iStock.

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  • avenez

    As someone in the rental industry I see a few issues in this article. To say the waivers are often no better than card coverage is completely wrong at worst, and inaccurate at best. It would be better to say while the (full) waiver (which is not insurance but an agreement wherein the company waives their right to charge you for damage) is usually the most complete option, your card coverage may be sufficient. There are never any vehicle exclusions or maximum amounts to the (full) waiver, even exotic cars are covered. In terms of secondary coverage, usually this means your personal auto insurance will pay the claim, and the secondary card coverage provided by your credit card will pay (reimburse) your deductible. (Note that in some states a rental car is considered third party property and as such your vehicle liability insurance will cover damages to rental cars.) Alex commented that liability coverage is implicit in renting a vehicle and is 100% wrong. Hertz is no more liable for an accident you cause than your landlord is for a fire you start that burns your neighbors house down. Read the rental agreements from any of the top companies and you will find several statements to the effect that by declining any liability coverage they provide you are assuming full liability. So the other thing to bear in mind when using card coverage is to ensure you are capable of satisfying the liability requirements of the state of rental via your own auto insurance policy or another method, or alternately accept liability coverage from the rental company. Uninsured renters be aware, while unlikely, if pulled over in a rental vehicle the officer can ticket you for driving without insurance if you have no liability coverage of your own and have declined the rental companies liability coverage. Again, the article here is inaccurate as enterprise rent-a-car’s supplemental liability coverage covers up to $1,000,000, as does hertz liability insurance supplement. I believe most other major companies have similar outrageously high coverage amounts, and would be shocked to find any liability plan offered that covers less than $100k. You could pretty much drive (accidently, of course) into every single vehicle in the first row on a lot of a dealership and not exceed that amount.
    I’m not sure on Mary’s question above. I suspect they would likely not cover it, but could be wrong. Some cards (such as Amex) offer am optional benefit in which you can enroll where a flat fee is charged per rental transaction to provide coverage, so that you could simply pay that one flat fee each month when your contract is closed and reopened. However I am unsure if there are any terms that would prevent that in the program. Another tip would be to clarify many cards only pay loss of use when fleet utilization logs are provided by the rental company, and virtually no rental company ever discloses these as at times there is no way to do so without releasing some amount of personal information of other customers and so the card company can leave you holding the bag for that amount.

  • Elliot J. Stamler

    Depending on state law, car rental companies may be required to provide MINIMUM liability coverage similar to the minimum statutorily required of all car owners. If so you are taking a substantial risk if you do not purchase supplemental liability from the renter UNLESS your own auto insurance policy will cover liability for rental cars. If it doesn’t or if you do not own a car and thus have no auto insurance policy, as is the case for many here in NYC where I live, you are risking a great deal by not getting the supplemental liability coverage..if you have a bad accident or God forbid, injure third parties, the statutory minimum that presumably you have from the renter, will not even begin to cover your potential financial liability-once the tort lawyers get ahold of you and sue you. This is especially true if you are worth something with reasonably substantial assets.

  • Kevin M.

    Why are you people so STUPID to think that some credit card will magically back you up or that your insurance company will come to your rescue???? Those companies are in it to make a lot of money and aren’t about to give it away. They will look for any possible loophole to get out of paying, not to mention the amount of out of pocket expenses you will have to pay before your insurance company kicks in, plus the loss of use fees and the hassles and paperwork that you will also have to go through for months. You people are so blind thinking that some other company is going to “save” you when you damage a rental car. I am an insurance agent and because of potential out of pocket expenses reaching into the thousands of dollars, I owe it to my customers to explain just what they are getting into and how the damage waiver purchased only through the rental car agency can protect them. Any insurance agent who tells you don’t take it or you don’t need it, is a horrible insurance agent and does not have your best interest in mind. Find a new one!!! The damage waiver from the rental companies is a complete walk away. If anything happens to that car while you are renting it (as long as you don’t do anything to void the contract like have an unauthorized driver or take the car off road) you are not liable for anything.
    Even you people traveling for work thinking that your company will come to your rescue. So many of my customers have thought that very thing but the company denied them for simple things like an accident happening after normal work hours.
    WAKE UP PEOPLE!!!! Do yourself a favor, protect yourself the easiest way possible, take the damage waiver and you wont have to worry about a single thing while you have a rental!

    • m1nd7r1p

      Really? I’m stupid? With AmEx. I always decline the CDW, save money, and have been covered by AmEx when needed. Once, while at a ski area in Tahoe, our rental SUV had a broker rear window while we were out skiing–no idea what happened, if it was an accident someone would have had to hit it pretty hard with a ski/snowboard to break it, but break it they did. There was nothing in the car to steal anyway. AmEx covered the claim in its entirety, the rental car company had a driver bring down another SUV and swap them out, no headaches at all for us. Declining the CDW has saved me money and I’ve been fully covered every time its been an issue. I would say I’m quite awake, thank you very much–I still don’t “worry about a single thing while [I] have a rental!” I’m guessing you work for a rental company.

      • Kevin M.

        Well m1nd7r1p, I will go over this again since you are obviously very slow and cannot read. As I stated early I am in fact an Insurance agent, not a rental car agent. I work very closely with rental car companies as well as credit card companies. I have spent hundreds of hours getting the facts straight as a service to my clients. Based on your experience you were lucky, but total that SUV and you will see them turn and run. There is a huge difference between a $500 window and a $50k SUV. AmEx makes you pay for their premium rental insurance too, not to mention the higher regular fees that AmEx makes you pay. AmEx insurance is again insurance. All insurance has loopholes and exceptions. Things that are designed to limit the amount the insurance company has to pay out. Why don’t you take a look at ALL the fine print? Thinking your AmEx will magically save you if your rental car is damaged is like saying your HMO will my make you feel better no matter what’s wrong with you. Why put yourself at risk of potentially paying thousands of dollars of out of pocket expenses for a vehicle you will never see again???
        I had a colleague who was very arrogant thinking his AmEx was going to cover his rental car and all he had on his car was liability. So when he drove up a mountain road a little too fast and his car slid off the road and was totaled, his AmEx denied his claim and he ended up making monthly payments on a $25k convertible that he rented.
        I am very glad you sleep well at night, most people who don’t have a clue do sleep well. Find a large dent in your rental car next time and I guarantee you will not be sleeping so well. Do a little research next time you blast a seasoned professional and make yourself look like a fool who should be riding the short bus!!

        • tiredofhate

          American express would not cover loss of use when I had an accident with a rental. The rental company would not send their “fleet logs” and i ended up having to pay more for loss of use than the repairs cost. Which my insurance State Farm paid all of except for my $250 deductible. I hate Amex. It took months of my time trying to get them to pay.

          • Berneigh

            Correction: Amex COULD not cover loss of use bc the rental company wouldn’t send the fleet logs. Don’t blame Amex for that.

          • tiredofhate

            That’s just Amex sneaky way of getting out of paying loss of use. None of the car rental places will send their fleet logs. It’s just a bunch of BS and I will never think of Amex the same way. I was told that in Massachusetts thatAmex has no right to even consider weather their were other rentals available as in court they can not take a business income into consideration and that’s basically what they are asking. So don’t tell me Amex could not pay, they had a bill and they very well could have paid. As I said that is their way of getting out of it.

          • Berneigh

            Whatever you say. No company is going to pay a bill from another company without getting documentation. Otherwise rental car companies would charge whatever they want for loss of use. Would you pay a contractor without knowing how they got to that number?

          • tiredofhate

            Loss of use can be determined by the damage done and the typical time it would take to repair that damage times what is usually charged for the car on a daily basis. It’s not that hard to figure out. I do not know why you are defending this practice unless have a horse in the race. Do you work for Amex by any chance?

          • Berneigh

            I don’t. You’re just incorrect. Loss of use isn’t determined just by damage done and time to repair. It’s also determined by the car rental company’s ability to have enough cars available while the car is being repaired. For example, if the company has enough to rent out while it’s in the shop, why would it need to charge anything beyond depreciation and interest or lease fees? There are simply too many variables there for any credit card payment network to just trust the car rental company.

        • sirgareth

          My brother and i were traveling when he had to take evasive action to avoid a truck. We went in the ditch and did substantial damage to the rental car. Single car accidents are not even covered by most rental car insurance and then only if the police are notified and investigate (pretty tough if you are at a remote location as we were.)

          Since we refused rental coverage Master Card picked up the whole charge. Every penny was covered and it was really easy (Costa Rica) Had we purchased local insurance it would have been a nightmare.

          • barb

            Our rented Cadillac was hit in a parking lot in NY a few years back. Master card covered our entire claim as well. Everything was handled when we returned the car back to the rental agency in Illinois. It was a beautiful thing:)

          • Berneigh

            But, but but. Kevin M says that’s not true!

        • Jeffrey Allender

          You are a douchebag, Kevin. The guy explained he loves Amex because they helped him every step of the way, and you say that they are only out to make money. Obviously not. Why do you need to come on here and blast people for no reason? You are obviously a disgruntled insurance salesman who hates that not everyone gets ripped off on rental company’s overpriced ridiculous crap insurance they try to scam people into buying who really dont even need it. Get a life and a real job, you douchebag.

      • Jeffrey Allender

        Hes obviously just a disgruntled low end salesman who has nothing else better to do than attack the informed. People like this scam artist HATE informed people like us who they can’t prey on and try to scam them out of their hard earned money. Let the little boy throw a temper tantrum and call you names…..

    • Jeffrey Allender

      You are one arrogant self righteous passive aggresive piece of garbage. obviously you either work for a rental car company or an insurance company who rips people off on these crappy overpriced “protections” that are NOTHING MORE than a money maker for the rental and insurance company, and a nice commision for you people. Why dont you get yourself a REAL job that doesnt involve lying and ripping people off on crap they dont even need. Rather than come on a thread and attack people for no reason. I’d say you are nothing more than a disgruntled unprofessional low-end salesman who hates the fact that not everyone falls for your little scam insurance. Get a life and a real job, you douchebag.

  • hawkslionsfam

    The Premium and primary AmEx coverage worked for us. We signed up for the AmEx premium rental insurance a few years back which charges about $25 per rental on our Delta AmEx card and it REALLY came in handy. Over Thanksgiving a few years years back our rented crossover SUV was hit in the parking lot of a grocery store. We didn’t see it happen. We called the company that handles the AmEx car rentals, they took our information, and told us that they would cover everything and be the primary insurance. This being our first rental car accident, we went ahead and called State Farm – our insurance company. (As a sidenote, and this may seem like overkill, but with State Farm, we also had on the extra insurance rental car coverage rider, which is about $5 extra dollars a month. We’d call and take it off after we finished up our rentals. I believe this covers any cost the rental companies might charge related to not being able to use the car while it was being repaired if an accident were to occur). So we talked to State Farm about the accident, explained what happened, told them about our AmEx coverage which was supposed to be primary and the State Farm representative said they would contact AmEx and the rental car company to confirm. Later on State Farm called us back to say, YES, everything is covered by the AmEx coverage so they wouldn’t have anything else to follow-up on. They closed the case but said follow-up if something ended up not being covered. That wasn’t ever necessary as the AmEx insurance took care of things. So we definitely benefited from the extra AmEx coverage and wouldn’t hesitate to recommend it.

    • hawkslionsfam

      And I stumbled across this article because we are considering cutting off the AmEx card (for reasons unrelated to the topic of discussion) but was wondering if any other companies offered the extra premium insurance.

  • Jeffrey Allender

    Too bad more people dont know that they most likely dont need to purchase the rental car company’s overpriced insurance that typically almost doubles the price of your rental cost. I think its ridiculous how much they charge for these “protections” to begin with. Its insane and nothing more than a money-maker for the rental agencies. I see we have quite a few disgruntled rental car agents on this thread trying to defend the need for these way overpriced “protections”. I am already double insured. Through my own private collision insurance, and me credit card company. I really hate when these agents try to push me to buy their insurance and try to talk down to me like I dont know what Im talking about. I typically just blow them off and tell them to just finish the transaction so I can leave. Im not here to get a lecture on car insurance, just give me my car. If these insurance “protections” they offer were more reasonably priced, maybe I would purchase it. But Im not paying almost double the price to rent a car for insurance I already have. Its dumb.