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Credit Card Applications » Research » Infographics » Traveling with Credit Cards » Credit Cards and Car Rentals – Are You Really Covered?

Credit Cards and Car Rentals – Are You Really Covered?


Updated: October 11, 2017

The content is accurate at the time of publication and is subject to change.
Car Rental Coverage by Credit Card

Renting a car is a rite of passage – you only have to be 18 to vote and 21 to buy booze, but most places won’t rent a car to anyone under 25 years old. Not only that, you’ve got to have a credit card.

The first time I rented a car, on vacation in Hawaii and feeling very adult, my uncle advised me not to fall for what he called “the rental car insurance scam.” He said that the credit card I used to pay for the car would provide insurance coverage, so I wouldn’t need it from the rental company.

I did some quick calculations on my savings:

Enterprise - $9 a day for Loss Damage Waiver and Collision Damage Waiver combined, $14 for SLI, and $2.5 for Personal Accident Insurance and Personal Effects Coverage. If you want all of it, you'll pay $25 a day – more than half of the $48 per day cost of renting one of their mid-size cars. Dollar, Budget, and Alamo offer similar rates for this coverage, only varying by a dollar or two per day.

Here is a side-by-side review of 4 major U.S. car rental insurance prices: *

Daily Rates
Enterprise
Car Rental
Dollar
Car Rental
Budget
Car Rental
Alamo
Car Rental
TYPES OF COVERAGE Enterprise Car Rental Dollar Car Rental Budget Car Rental Alamo Car Rental
LDW (Loss Damage Waiver). In case the car is stolen. $8.99 $9.00 $9.00 $9.00
CDW (Collision Damage Waiver). Covers accidents $8.99
(included in to LDW)
$9.00
(included in to LDW)
$9.00
(included in to LDW)
$9.00
(included in to LDW)
SLI (Supplementary Liability Insurance). Extra liability, up to $1 million $13.80 $12.99 $14.50 $12.95
PAI (Personal Accident insurance). Death or injury from a car accident, usually covered by your health or travel policy. $2.50 $6.99 $3.00 $6.90
PEC (Personal Effects Coverage). Theft or damage to your personal stuff inside the car. $2.50
(included in PAI)
$6.99
(included in PAI)
$3.00
(included in PAI)
$6.90
(included in PAI)
TOTAL $25.29
per day
$28.98
per day
$26.50
per day
$28.85
per day

I felt like I’d been let in on a secret, and confidently refused insurance coverage anytime I rented a car from then on.

So, was my uncle right? Does your credit card really provide all the coverage you need when you rent a car? Nobody wants to bother reading the fine print on credit card agreements and rental car terms – but that’s what we do for you here at Credit-Land.com every day. We’ll help you decide what coverage you need, and make sure you’re really getting what you think you’re getting. To weigh the details of which types of vehicles are covered, for what time period, any geographic limitations, and other important details, check out Credit-Land.com’s handy Guide to Credit Card Rental Car Coverage infographic.

Credit-Land.com Guide to Credit Card Rental Car Coverage

To embed the Guide to Credit Card Rental Car Coverage to your site, use the following code:


Credit Card Coverage in Simple Terms

So, credit card coverage includes damage and theft, but it does not cover personal injury, liability, or property. It also does not cover any driver who is not authorized on the car. Only the people named on the car rental agreement are covered. Also, certain types of vehicles aren’t covered – usually trucks, campers, and other specialty cars won’t be covered. Comparing with our side-by-side review of U.S. Car rental services, the only two items covered by any credit card rental insurance are LDW and CDW – car theft and damage. Supplementary coverage, personal coverage and medical coverage are not included in standard credit card rental car insurance agreements. SLI, PAI, and PEC are not included.

Premium Card, Premium Coverage

Only one card – American Express – offers a premium rental car insurance option that you can purchase. This insurance covers medical expenses as well as the usual LDW and CDW up to $100,000 – and the $24.95 fee is per rental period, not per day. American Express is known as a premium card for travelers and having access to deals like this is one of the ways being an AMEX cardholder pays off.

To choose or not to choose Credit Card Rental Protection?

Credit card car rental insurance is always considered secondary coverage – it covers you if you don’t have other car insurance or if you do not purchase insurance from the rental company. A very important thing to know is that with any credit card rental insurance, buying the coverage from the rental company will invalidate your credit card insurance coverage. You can’t get coverage from both sources at once. However, if your personal car insurance has a deductible, then your credit card will cover that amount. Keep in mind, although your rented vehicle is protected, you will need a separate insurance to cover possible liability damages you may cause to the other vehicle or property involved in the accident. As always, the best solution is to be careful while driving.

With that in mind, happy - and safe! - driving to you.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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  • Saldiccio

    this is incorrect, the AMEX plan does not cover liability 
    http://search.americanexpress.com/app/answers/display/a_id/1454

    • CreditLandCom

      You are correct. Will fix this ASAP.

  • Akhilorders

    Hi,

    If I rent a car using points and pay the taxes etc. using AE card which has premium protection enabled, will I still be eligible for premium insurance.

    Thanks.

  • 40md

    There is a mistake in this.  AMEX does not cover liability.  Even their website points this out in the FAQ.   

    • CreditLandCom

      Thank you for pointing this out! Will update it ASAP.

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