Does your credit card offer car rental insurance? Great, but it may not cover what you think it is doing.
It is important to know how different the rental insurance is from your credit card, your car insurance and the rental company. This way, you can avoid unwanted financial surprises when you are on a charter flight.
It is important to know how different the rental insurance is from your credit card, your car insurance and the rental company. This way, you can avoid unwanted financial surprises when you are on a charter flight.
What does your auto insurance cover?
In general, if you have car insurance, it also extends to car rental. However, this is not a rule, it is worth checking with your insurance company before renting a car.
It is also important to think about your types of car insurance coverage. Just because you have car insurance, for example, doesn't mean that everything related to cars will be covered. In general, auto insurance includes four main types of coverage:
It is also important to think about your types of car insurance coverage. Just because you have car insurance, for example, doesn't mean that everything related to cars will be covered. In general, auto insurance includes four main types of coverage:
- Liability: covers the damages caused to other people and their property.
- Personal Injury Protection (or PIP) - Covers your medical bills and passengers in an accident.
- Collision: covers accidental damage.
- Full: covers non-collision costs such as cold damage or theft
When considering a car, it is a good idea to make sure you have coverage for all of these areas.
The benefits of car rental credit card insurance
Getting a good credit card for car rental insurance can be especially helpful for people who travel a lot, this is why:
It's free
Many travel credit cards offer car rental insurance as a built-in feature for cardholders. See your card guide for benefits, for details on limits and coverage.
there is no discount
Surprisingly, most of what people call "credit card rental car insurance" is not insurance.2 It is a Collision Waiver (CDW) or Damage Waiver (LDW), which means that If the vehicle is damaged or stolen, it will not. Be on the hook to replace or fix it. These costs will be eliminated entirely, so you don't have to worry about paying any discounts.
Disadvantages of car rental credit card insurance
Car rental coverage from the point of issue of your credit card is a free and valuable feature, but it is not universal coverage. Here are some drawbacks to consider:
You need to do some things to get it
To make sure car rental insurance is using a credit card, you will need to do each of these three things, in most cases:
- Must be the primary tenant listed in the vehicle rental agreement.
- You must pay with the credit card that provides the coverage.
- You must decline optional coverage from the rental company
Most credit card auto insurance is not basic coverage
Most of the credit card car rental insurance you see these days is only secondary coverage. This means that you must first file a claim with the main insurance company. Only then will you enter secondary coverage and cover the expenses you had to pay out of pocket, such as a discount or some fees that your insurance company does not cover.
Your coverage may have limitations.
It's easy to fool yourself with a false sense of security. Vehicle rental insurance seems complete, right? If that's all it depends on, and don't check to see if it's covered in other areas as well, you could be in trouble for more than you bargained for.
Also, car rental insurance may not be covered by credit card if you travel to certain countries, for long periods of time, or for certain types of cars. It can also be revoked if you do some things, like driving on dirt roads or causing a speed accident.
Some common types of exclusions you may see include:
Also, car rental insurance may not be covered by credit card if you travel to certain countries, for long periods of time, or for certain types of cars. It can also be revoked if you do some things, like driving on dirt roads or causing a speed accident.
Some common types of exclusions you may see include:
- Rentals in Jamaica and Israel
- Cars are expensive or old
- Trucks
- Motorcycles
- Recreational Vehicles
- US Rentals for more than 15 days
- Cause harm while driving under the influence
- Damage caused by driving without a valid license
Not provided with all credit cards.
Although it's quite common to see that "car rental insurance" is listed as a feature in your card's feature guide, it doesn't come with all major credit cards. For example, it is common for unsecured CDW cards. It is worth noting that Discover, one of the largest credit card issuers around you, does not offer car rental services with any of its cards.
Auto rental company benefits for insurance
When you complete the paperwork to obtain the keys to your rental car, the dealer will often try to sell you optional rental car insurance. Here are some of the reasons why you might consider this:
If you don't have all the kind of coverage you need, you can get it now
Not everyone has auto insurance. If you depend only on the rental car coverage on your credit card, you are protected against damage to the rental car. But as we said, this is only part of the whole picture.
You also need to cover liability and personal injury (if you don't have health insurance, that means). Otherwise, you run the risk of being sued for any injury caused to other people or material damage to others. If you don't have these things right now, it's time to buy them.
You also need to cover liability and personal injury (if you don't have health insurance, that means). Otherwise, you run the risk of being sued for any injury caused to other people or material damage to others. If you don't have these things right now, it's time to buy them.
You can avoid making a claim with your insurance
Buying insurance from the rental company can also be helpful if you want to avoid making a claim and paying a discount from your auto insurance company. You will need to read the fine print carefully, of course, to make sure there is no discount. In general, a collision damage waiver frees you from having to pay anything, including the opponent.
Disadvantages of the car rental insurance rental company
It is important to consider the downsides when it comes to car rental insurance.
Selling insurance you don't need is often overrated
Let's face it: Insurance is a complicated and often boring topic. Subscribing to optional car rental insurance is easy when it's on the table because the agent tends to try to persuade you to buy your policies.
If you already have car insurance, you may already be covered for most, if not all, of the rental company's deals.
Selling insurance you don't need is often overrated
Let's face it: Insurance is a complicated and often boring topic. Subscribing to optional car rental insurance is easy when it's on the table because the agent tends to try to persuade you to buy your policies.
If you already have car insurance, you may already be covered for most, if not all, of the rental company's deals.
cost
Buying insurance from a car rental company can cost between $ 20 and $ 50 per day on average. Paying the insurance for days or several weeks can make renting expensive.
Is it worth buying insurance from a rental company?
If you don't have enough insurance through the auto insurance company, it may be a good idea to consider buying additional coverage through the rental company.
For example, if you don't have a PIP on a car or health insurance policy, you may want to add a PIP through the car rental company. The average physical injury claim in 2018 was $ 15,785, according to the Insurance Information Institute, a huge medical bill that you'll face if you don't have insurance.
For example, if you don't have a PIP on a car or health insurance policy, you may want to add a PIP through the car rental company. The average physical injury claim in 2018 was $ 15,785, according to the Insurance Information Institute, a huge medical bill that you'll face if you don't have insurance.
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