Car Rental Insurance: What do Credit Cards Cover?


Summer is one of the peak seasons for vacationing, travel, and car rentals. Even though there may be coverage through an auto insurance policy for a rented vehicle, consumers often purchase additional insurance when choosing to rent a car. Why is this the case? According to the National Association of Insurance Commissioners, 62% of consumers are not aware that their personal auto insurance may provide coverage for rental cars, and 24% are not sure whether any coverage is provided by their credit cards. In fact, many of the largest credit card companies offer rental car collision coverage as an added perk.

But what exactly does their plan cover?

A study completed by CardHub sought to examine this exact question by examining the publicly available online car rental policies belonging to VISA, Discover, MasterCard, and American Express. Here’s what they discovered:

  1. All four major credit card companies provide some form of rental car insurance.
  2. MasterCard is the only company of the four that doesn’t provide coverage on all their cards.
  3. American Express received the highest score for its policy, followed by Discover, MasterCard, and Visa.
  4. In order to be eligible for coverage, all four cards require you to charge your entire rental car purchase on your card and decline any supplemental insurance or Collision Damage Waivers provided by the car rental company.
  5. None of the cards provide coverage for renting of exotic or expensive cars, trucks, or off-roading vehicles.
  6. VISA specifically does not cover dirt and gravel road accidents. MasterCard does as long as the roads are “regularly maintained.”
  7. All cards exclude car rentals that exceed specific time limits, and many of them have country limitations as well.
  8. American Express is the only card that doesn’t provide coverage for renting a particular set of SUV’s, including the Suburban and Tahoe from Chevrolet, GMC Yukon, Ford Expedition, Lincoln Navigator, Toyota Land Cruiser, Lexus LX450, Range Rover, and full-sized Ford Bronco.
Before purchasing car rental insurance, remember to check with your current car insurance provider to see if your coverage would extend to a vehicle that you rent. If a rented vehicle is not covered or if there is limited coverage, a good next step is to contact your current credit card provider to see what sort of coverage they can offer you. If you have any additional questions about car insurance options when it comes to car rentals, don’t hesitate to reach out to a specialized Insurance Town & Country agent.

Source: Property Casualty 360

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