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Upon walking up to the desk to rent a car, you can expect a flurry of upsells to come your way, including rental car insurance. Although that might seem like a given, you may already have credit card car insurance available. Many major credit card companies offer this perk to encourage you to use your card on your travels. But the coverage may not include all losses—and not all perks are made equal. Here’s what you need to know to make the best rental car insurance decision.
When you rent a car, you’re fully responsible for anything that happens to it. So, whether the car ends up vandalized while parked or you get into an accident, they will charge you for the repairs. Worse yet, you’ll have to pay for the full replacement of the vehicle if it gets totaled.
Beyond that, car rental companies charge for loss of use or the income they cannot make with the car out of service. To cover that loss, they tack on the full rental rate for each day the car is out of commission.
With that, a small fender bender could end up costing thousands as the repair costs and daily charges rack up. And it’s all due out of pocket unless you have the right level of car insurance available for your rental.
You may use your auto insurance policy if you have collision and comprehensive coverage on all your vehicles. Otherwise, you need to either go with a policy from the car rental agency or through your credit card.
If anything happens to your rental car on your travels, credit card car insurance can save you from the cost of repairs and loss of use. They provide this coverage as a Car Rental Collision Damage Waiver and Loss Damage Waiver instead of a normal auto insurance policy. These waivers are the same type of coverage offered at the front counter when you reserve your rental car.
Since every credit card is different, you must read your benefits guide to figure out their exact coverage terms. As you read the guide, it will tell you whether you have primary vs secondary coverage plus the requirements and exclusions.
With primary credit card car insurance, you do not need to worry about having any other type of coverage on hand. You can have the car rental agency send any resulting bills directly to the credit card company for processing.
If your credit card company only provides secondary coverage, you must file a claim with your auto insurance company first. The credit card company acts as a backup to your insurance and covers any charges you’re responsible for, including your deductible.
Your credit card car insurance is only valid on rentals when you make your reservations using the card in question. Most credit card companies also ask that you decline all the insurance options offered by the car rental agency.
As you fill out the reservation form, remember to list all drivers who will pilot the vehicle during your trip. If you don’t, then they will likely deny your claim if any of the unlisted drivers cause an accident or otherwise damage the vehicle.
To receive the coverage benefits, you must abide by all terms of the auto rental agreement and their credit card usage terms. If either entity finds you broke their rules, your credit card company could decline to pay the resulting bill for repairs and loss of use.
Most credit card companies only provide coverage for standard car rentals. So, if you’re after luxury SUVs, large trucks, and high-performance sports cars, then you’re probably out of luck. You’ll have to either rely on your personal auto insurance policy or pay for coverage through the car rental agency.
In addition, credit card car insurance doesn’t include any bodily injury or liability coverage. So, if you’re deemed at fault in an accident, you’ll need to cover the other parties’ medical bills, property damage, and other losses.
Your car rental company may provide basic liability. But, its coverage levels might not be high enough to cover all expenses. In that case, you’re still on the hook for the extra costs unless you have additional coverage in place.
If you’re unsure what your credit card car insurance covers, simply call their customer service team and ask. They will go through all the coverage benefits, limitations, and requirements with you, so you can make the right decision before booking your rental car.
To find the best credit cards for car rental insurance, look toward the leaders in providing travel rewards. Since these cards are geared toward regular travelers, they typically have primary rental car insurance. They may also let you pay for your rental car with your travel rewards to save you even more money in the long run.
Before you sign up for a credit card, always ask to review their benefits guides in full. As you read through, take note of their rental car insurance perks and other rewards relevant to your interests. Then, compare their annual fees and interest rates to zero in on the right card for you.
If the unthinkable happens while renting a car, most credit card companies make it easy to file a claim.
You’ll just have to report the incident to them within 45 days and provide:
· Official accident report
· Claim document from the car insurance agency
· Itemized repair estimate and a final bill
· Copies of your car rental agreement
· Photos of the damage to the vehicle
You may also need to provide the credit card company with a police report if you made one at the time of the incident.
If you only have secondary coverage, remember to file the claim with your auto insurance company first. They will then need to provide a statement that shows how much they paid out and what you’re responsible for covering.
Once you have all your paperwork turned in, your credit card company should process the claim within 15 days. After that, they will let you know what actions they took and if there’s anything else you need to do.
Although credit card car insurance has its limitations, it’s nice to have on your side while you travel. With the extra coverage in place, you can focus on the road ahead without worrying about what could go wrong.