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Rental Car Insurance: Which Credit Cards Have You Covered

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—Aw, nerds! Looks like the American Express Platinum offer mentioned here is temporarily unavailable.

Do you really need rental car insurance? Many rental agencies offer damage waivers for about $15-$25 a day, selling peace of mind along with expanded coverage. However, these waivers, which you’ll hopefully never need, are often no better than the coverage you already have. Not only does your primary insurance company often step in, but every state has a minimum insurance requirement.

Depending on where you rent, the rental company’s liability for injury or property damage may be anywhere from $25k to $50k. The base insurance requirement still leaves you open to significant liability, particularly when it comes to six-figure medical bills. Thankfully, your credit card will also step in – sort of. All four major card networks offer rental insurance, but have substantial variation in benefits and requirements.

Please note that cards on the same network may have varying levels of coverage. Some issuers don’t offer rental car insurance at all, while others set terms different from the network standard. Please call your bank to ask about your specific card’s benefits.

Benefits by network: an overview

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 offers just about the best free benefits in the business. First off, they offer rental car insurance on all of their cards – standard, Signature, rewards, the works. If your car is stolen or damaged, AmEx and MasterCard require you to turn in the keys to prove the car wasn’t unlocked at the time. Visa has no such requirement.

MasterCard: Its benefits are also fairly standard, although it doesn’t cover loss of use in practice or theft of an unlocked vehicle. It also is not offered on all cards – according to Customer Service, Platinum and World MasterCards “generally” come with the benefit, but not always.

American Express: AmEx is the only one to offer extra coverage for a small fee. It offers free secondary coverage up to $50,000 ($75,000 on the American Express Platinum) but will offer primary coverage with a higher limit and protection against injury and property damage. It does require you to report the damage in a short 48 hours, so be aware that you need to file your paperwork quickly.

Discover: Discover’s benefits are the worst of the lot. The coverage is limited to a handful of cards. Unlike the other three networks, Discover makes no pretense of covering loss of use fees, covering only collision damage up to a scant $25,000. The only bright spot is that the Discover Escape offers a step up from the network’s other offers.

Drilling down: a network-by-network comparison

Visa and MasterCard

Both Visa and MasterCard say that their terms vary by issuing bank. MasterCard, for example, could not tell us that certain tiers of cards would or would not receive coverage, and Visa told us that the maximum vehicle value would vary by issuer.

Benefit Visa MasterCard
Offered on All cards Platinum MasterCard and above
Rental Period 15 consecutive days domestic/31 abroad 15 days domestically
Must decline rental insurance? Yes Yes
Vehicle Value Not specified <$50,000
Includes Physical damage, theft, loss of use*, towing, administrative costs Physical damage, theft**, loss of use*, towing
Excludes Injury, 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, RV’s, motorcycles, ATV’s, limousines, and certain vans
Excluded Countries Ireland, Israel, Jamaica Ireland, Israel, Jamaica. Maybe Italy, New Zealand, Australia
Exclude SUVs with more than 8 seats 9 seats
Max coverage Not specified $50,000
Max loss of use Not specified $500
Report/file claim within 45/90 days 60/180 days
Source Visa MasterCard

*In order 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.
**Must turn in your car keys as proof that the car was locked at the time of theft.

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 Platinum Card All cardholders can purchase
Rental Period 30 days, consecutively or in a 45-day period in the same 75-mile location 30 days, consecutively or in a 45-day period in the same 75-mile location 42 days (30 in Washington State)
Must decline rental insurance? Decline full, can accept partial
Vehicle Value <$50,000 <$50,000 Unlimited
Includes Physical damage including vandalism, theft**, towing. Also covers property damage and injury Also covers property damage and injury
Excludes Diminished value, taxes, wear and tear
Primary or Secondary? Secondary Secondary Primary
Drivers Covered All authorized drivers
Vehicles excluded Expensive, exotic or antique cars, trucks, pickups, RV’s, motorcycles
Excluded Countries Ireland, Israel, Jamaica, Australia, Italy, New Zealand
Exclude SUVs with more than 8 seats N/A
Max car coverage $50,000 $75,000 $19.95 plan: $75,000 $24.95 plan: $100,000
Max medical expenses per person N/A $5,000 $19.95 plan: $7,500 $24.95 plan: $15,000
Accidental death and dismemberment: $75,000/$100,000
Max property damage N/A $1,000/person, max $2,000 $5,000/person, $10,000 max
Max loss of use Proprietary information
Report/file claim within 2 days/60 days
Source AmEx AmEx AmEx

**Must turn in your car keys as proof that the car was locked at the time of theft.

Exemptions

Students: Personal, Gold and Rewards Plus Gold cardholders who are enrolled in a four-year college or graduate program in the U.S., and are receiving student benefits provided by cardmembership, are ineligible.

California: Additional coverage costs $17.95, maximum coverage extended to

  • $100,000 car damage
  • $100,000 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:

Discover provides primary rental insurance  on the Escape card, or if the car is a) rented outside the US, b) rented by an employee using a business credit card and c) rented without a driver.

Benefit Discover Discover Escape
Offered on Motiva, Miles, Open Road, More Escape
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** and towing
Excludes Theft, any damage not due to a collision, loss of use Diminished value, taxes, wear and tear
Primary or secondary? Secondary Primary
Drivers Covered All authorized drivers
Vehicles excluded Expensive, exotic or antique cars, trucks, pickups, RV’s, motorcycles
Excluded Countries Valid in any country that accepts Discover Ireland, Israel, Jamaica, Australia, Italy, New Zealand
Exclude SUVs with more than 7 seats 7 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/180 days
Source Discover Discover

**Must turn in your car keys as proof that the car was locked at the time of theft.

Cards that offer PRIMARY car rental insurance

All of the networks give extra coverage to some of their high-end cards. Here’s a few of the ones lucky enough to get primary insurance:

United MileagePlus Explorer: The United MileagePlus Explorer is the recent lovechild of the Continental/United merger, replacing the old MileagePlus Select Signature Visa.  And fortunately for previous United cardholders, this new one is identical to the OnePass Plus, down to the rental car coverage.

United MileagePlus® Explorer Card
Chase United Airlines Mileage Plus Credit Card
Apply Now

on Chase's
secure website

starstarstarstarhalfstar
  • Start with 30,000 bonus miles after you spend $1,000 in the first 3 months
  • Check your first bag for free — save up to $100 per round-trip
  • Enjoy priority boarding privileges and visit the United Club with two one-time-use passes every year
  • No foreign transaction fees!
  • Earn double miles on United ticket purchases, and 1 mile per $1 on all other purchases
  • Your miles don't expire as long as you're a Cardmember, with no limit to the number of miles you can earn
  • Use your miles for any seat, any time, on any United flight
  • $0 intro annual fee for the first year, then $95
thumbsupPros
  • No foreign transaction fee
thumbsdownCons
  • Has annual fee
Annual Fee Signup Bonus APR , Variable* APR Promotions
$0 intro annual fee for the first year, then $95 Start with 30,000 bonus miles after your spend $1,000 in the first 3 months. 15.24% (Variable) Purchase: None
Transfer: None

An explanation of benefits

Here are some of the often used, but less often understood, terms you’ll see when combing through damage waiver terms and conditions:

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

Special thanks to Paul Burke for inspiration and research on this article.

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  • Student

    @NerdWallet, I need clarity on the Visa “Rental Period 15 consecutive days domestic”…Is it safe to assume this coverage is no good for a weekend getaway?