The next time you rent a car, consider using the insurance available through your credit card, Collision Damage Waiver (CDW), in addition to the car insurance you already own, rather than opting in for the $15-$28 per day the rental company provides.
Many drivers don’t realize that their credit cards offer secondary car insurance on rental vehicles and the coverages that they offer are substantial, and often times even better than the coverage offered by the rental company. Secondary coverage means the credit card company’s insurance program pays the difference of deductible the primary insurer (insurance company of your personal vehicle) does not pay.
Opting in for the credit card’s rental coverage is simple. Use your credit card to pay for the rental and you will automatically be covered as long as you comply with their requirements. A couple of things to remember is that in order for your credit card’s coverage to kick in for any reason, the rental must be paid in full by the credit card before any incident occurs. Second, if given the option, the cardholder must decline or waive the CDW offered by the rental agency. Generally, what’s not covered across the board are luxurious cars worth over $50,000, off road vehicles, trucks and vans.
In some cases this is not an option, for example on a recent car rental booking in Croatia the company said it was mandatory that all cars have coverage. When I spoke on the phone with Visa's insurance benefits department the representative told me that if coverage from the rental company is mandatory in the country then the coverage from your card will still be valid. She also informed me that international coverage provided by Visa is always primary coverage--which is a huge plus because you will never have to use your own insurance if something were to happen to your rental car.
For the most part, the four major credit cards which offer secondary coverage are liable for collision damage, towing due to a collision and theft of a vehicle. They do not cover medical expenses, accidental death or damage to other property other than the rental.
Visa: Visa’s coverage provides peace of mind all the way up to stolen or damaged vehicles and for free. This means that regardless of the cardholders elite status, rental car insurance is available as long the requirements are meant. Visa will also cover the actual amount of the damage in its entirety.
**If you are taking a personal trip using either the Ink Bold or Plus business cards, your rental will not be covered under the CDW.
To File a claim: When making a claim with Visa, you must notify Visa no later than 45 days. You then have 90 days to provide the Benefit Administrator with a receipt that shows the full payment for the rental was made by a Visa card, Auto Rental CDW Claim Form within 90 days of the incident and any other necessary documents.
Excluded countries: Ireland, Israel, Jamaica
Mastercard: Mastercard offers coverage based on elite statuses (Gold, Platinum, World and World) of cardholders for basic collision coverage through their MasterRental program, however it does not cover personal injury, personal liability, personal property, medical payments to others, or damage to other vehicles. Again, you must choose waive the rental company’s coverage for the coverage to be available. Mastercard will cover costs up to $50,000 for things like towing the vehicle after a collision, damage to a vehicle and theft a vehicle as a secondary coverage.
To File a claim: Claims with Mastercard must be made within 60 days of the incident by calling their claims department at (800) MC.ASSIST. A police report may be required as well as a declarations page of any primary vehicle insurance and other valid insurance or coverage.
Excluded countries: Australia, Ireland, Israel, Italy, Jamaica and New Zealand
Discover: The Discover card offers a limited amount of coverage, up to $25,000 on personal cards or $50,000 for business. The coverage is also limited to Platinum, Miles by Discover, Discover Motiva, Discover Titanum, Discover Business and Discover Business Miles cards. A limitation of Discover is that it does not cover towing
To File a claim: To file a claim with Discover contact their claims department (800) 252.4670, or go to company website at www.chubb.com as soon as possible.
Excluded countries: The coverage applies to all countries that accept Discover cards
American Express Personal: The American Express policy also covers costs such as towing and storage costs in case of an accident with all Amex cards except the Delta Skymiles Options card. It kicks in as a secondary coverage if the primary insurance does not cover the entire claim up to $50,000 and $75,000 for Amex Platinum. Claims must be made within 48 hours and the cardholder must also be the primary person on the rental agreement.
To File a claim: Claims with American Express can be made online www.yourcarrentalclaim.com or by calling the claims department at (800) 338.1670 within 60 days of the incident. Be sure to have a police report of the incident on hand when filing a claim with Amex.
Excluded countries: Australia, Ireland, Israel, Italy, Jamaica New Zealand
By taking advantage of primary coverage offered by certain credit cards, you don't file a claim with your personal auto insurance company. This would also be ideal for anyone who does not own a vehicle or have insurance. For international car rentals (excluding the countries not covered by specific cards), all credit card companies provide primary coverage as long as you waive the insurance provided by the rental car company. For car rentals in the US, these cards will give you the benefit of primary coverage:
- American Express Premium Car Rental Protection: There is a one time fee of $24.95 ($17.95 for California residents) per rental for the entire period of the rental up to 42 days. Requires enrollment.
With the exception of the American Express CDW, primary insurance does not cover damages made to people, accidental death or damage to property, however your personal car insurance policy could possibly cover those types of claims.
Remember, to be eligible for any of the credits cards rental insurance for collisions the cardholder must be the primary driver listed on the rental agreement, the optional insurance offered by the rental company must be declined and the entire cost of the rental must be paid in full by said credit card. When traveling abroad, bring a copy of your primary and secondary policies to ensure that they are honored in case of any type of dispute against your coverage.
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