I’ve written in the past about the hidden costs of renting a car, and Laura touched on one of these – rental car insurance – yesterday. Today I want to follow that up by taking a closer look at credit card rental car insurance policies.
Believe it or not, all major credit card issuers provide you with rental car insurance coverage if you pay for the rental with your card. While I always charge my car rentals, I’ve never had to invoke the rental car insurance.
In the one instance where I did damage to a rental car, it was a business trip, and my employer had negotiated a deal where all work-related rentals got full coverage from the rental agency. Thus, I just called in to report the damage and then handed over the keys and walked away at the end of the rental.
Anyway, if you’ve been wondering about the type of coverage offered by the various types of credit cards,
Visa rental car insurance
According to Visa’s policy, you will receive coverage for both collisions and theft as long as you pay for the entire rental with your card. This coverage extends to all authorized drivers on the rental.
This coverage includes “reimbursement for damage due to collision or theft up to the actual cash value of most rental vehicles” in excess of any other insurance coverage that you might have.
As with most insurance policies, there are a ton of exclusions, including theft of personal belongings, personal injury, personal liability, loss due to off-road operation of the vehicle, and loss due to illegal activities.
MasterCard rental car insurance
According to MasterCard’s policy, you will receive coverage for collisions, theft, vandalism, and weather-related damage as long as you pay for the entire rental with your card.
Once again, this coverage extends to all authorized drivers on the rental, and it applies to amounts in excess of those covered by any other insurance that you might have.
As far as exclusions go, things like theft of personal items, personal liability, loss due to illegal activities, etc. are likewise not covered by MasterCard. In addition, the MasterCard coverage extends only to damage that occurs on paved roads.
Discover rental car insurance
According to Discover’s policy, you will receive coverage for collisions only. The coverage is once again secondary to any other insurance that you might have, and it’s limited to $25,000.
Interestingly, this coverage extends only to the person named on the Discover card, and it’s valid only in the United States and Canada. Otherwise, the exclusions are quite similar to those of other card issuers.
American Express rental car insurance
Finally… American Express. Their coverage is similar to that of MasterCard in that it covers collisions, theft, vandalism, and weather-related damage. However, like Discover, the coverage extends only to the individual named on the card.
They also exclude “large SUVs” as well as any damage that occurs off of paved roads. Aside from that, the coverage is quite similar to that offered by other credit card companies.
What about debit cards?
It’s worth noting that debit cards do not typically offer this sort of protection. Thus, if you pay with a debit card, you’ll not only be faced with a relatively large hold placed on your bank balance, but you’ll also be foregoing free insurance coverage.