One of the perks of travel hacking using a decent credit card is the free travel insurance that is frequently included. This insurance often includes rental car coverage, which means you can forego the expensive rental car company’s waiver which can run as much as $50 per day!
Comparing Credit Card Rental Car Coverage
It may sound simple — make the reservation with your credit card and use it for the final payment and get free coverage — but not all coverage is equal. Check out this overview of each credit card issuer’s coverage before deciding whether to skip the damage waiver and which card to use:
Discover cards provide the least amount of protection. They are specifically limited to collision damage. Everything else is excluded. That means shopping cart dings, vandalism, theft, rock chips, and fallen trees will be your responsibility if you decline the rental car company’s damage waiver. If you have comprehensive insurance coverage that will transfer to the rental car, this may not be a big deal. If not, use a different card or purchase the additional damage waiver.
MasterCard provides more coverage than Discover, but only to certain classes of cards. Gold, Platinum, World, and World Elite cardholders usually have coverage, but others do not. When coverage does apply, it’s good for up to 31 consecutive days — double Visa’s coverage limit. Most types of damage, including theft, are covered, but one of the most notable exclusions is that a gravel or dirt road must be “regularly maintained” for coverage to apply on incidents occurring off pavement. Vehicles up to $50,000 in value are covered with the exception of trucks, pickup trucks, and sport utility trucks.
Visa’s coverage is nearly identical to MasterCard. It covers accidents, theft, and other types of damage. The key difference is that Visa coverage only applies to rentals up to 15 days in length. Visa also excludes any incidents in unpaved areas — these can include seemingly innocent locations like grass or dirt parking lots at churches and schools. There is no specific limit to the vehicle value, but certain classes of trucks, pickup trucks, SUVs, and vans are excluded. The coverage is available on every credit card on the Visa network.
American Express is generally the highest regarded credit card issuer when it comes to rental car protection and actually has multiple levels of coverage. Its free coverage is actually slightly more restrictive than the other issuers because it only covers sedans and small SUVs up to $50,000 in value. Popular mid-sized SUVs and luxury cars are excluded. However, there are less exclusions for types of damages, and all authorized drivers are covered — not just the cardholder.
American Express also offers a premium coverage plan. For a per rental fee (not per day fee like with the rental car companies), the coverage limits are increased and additional classes of vehicles are included. Premium coverage also includes medical payments and damage to personal property.
Warning: Coverage varies based on the issuing bank and specific credit card product. Always be sure to check the terms of your specific cardholder agreement before relying on a credit card to cover your rental. You can do this by logging into your credit card account online or by contacting customer service using the number located on the back of your credit card.
Oftentimes if you have a decent full collision and comprehensive vehicle insurance on your personal vehicle it may automatically extend to a car rental. Contact your insurance company prior to renting to confirm coverage, fees that may be required as well as deductibles that would apply. Another thing to be aware of is that coverage from your own insurance company may not cover fees for administrative expenses, loss of use and loss of value fees that could be incurred in the event of a loss.