How does rental car insurance offered by credit card companies (when you use the card) work?

January 17, 2017 · Posted in FAQ 
car insurance
hedonist asked:

I have credit cards which say they cover me for rental car insurance when I use the card to make the full payment for the rental. How does that work? Are there any catches? Does it make sense for me to get the additional insurance from the rental agency (like Avis)? If I am in an accident, will the Credit Card insurance cover everything or will it also be charged to my regular car insurance company?

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4 Responses to “How does rental car insurance offered by credit card companies (when you use the card) work?”

  1. Mike C on March 26th, 2009 10:21 am

    I think if I remember right, the credit card only covers the deductable portion of your auto insurance. You would be best serve to contact your credit card company to make sure.

  2. Gizmo on March 26th, 2009 11:52 am

    Credit Card Insurance provided for rentals is a re-embursement of cost which means you must first pay to have the repairs done then submit the receipt to the Credit Companies Insurance.
    They can take as long as they like to re-emburse you and there is a chance you may not be fully re-embursed.
    Also there is the matter of “Loss of use” which is not covered by CC Insurance or Personal Insurance.
    This means that while the vehicle is being repaired and not producing revenue, you are still essencially renting a vehicle sitting in the repair shop.
    Only the Loss Damage Waiver offered by the rental industry allows you to just walk away.

  3. Fred C on March 27th, 2009 11:48 am

    Every card is different, and the card companies can change their insurance carriers without notice. Most of them give collision damage waiver only. If you have an accident, they will cover repairs over and above the rental company insurance, but they do not cover the cost of a replacement rental for you to drive. Very few of them cover liability. The most complete coverage may be offered by your insurance company, for a lower fee than the waivers offered by the rental companies. In Manitoba, for instance, we sell (to Manitobans) a rental car policy that gives $50 deductible for damage, loss of use coverage, and 5 million dollars liability coverage, and this package can be bought to cover a rented car anywhere in Canada or the US. So, before you rely on your credit card, read the wordings booklet, then talk to you auto insurance agent.

  4. kaly l on March 29th, 2009 7:26 am

    yes there is a catch.. most cc will only cover only after you have exhausted your car insurance.. and yes you should get coverage from the rental agent. why? beacuse when you get into an accident or if the vehicle is stolen they cover the car 100% no deductibles to you, even if the car was vadilized in the parking lot.. you don’t have to report it your insurance co so no high rates and no deductibles.. insurance co tell you not to buy it beacause when you file a claim they make money off of your deductible.. so when you cover the car from the rental you have the option of full or basic.. basic means the car is covered 100% no matter what happens.. I use to be a rental agent..:)

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