But not every card’s rental car insurance offers the same coverage and benefits, and some can include restrictions that could leave you uncovered if you’re not cautious. It’s important to read the fine print and make a careful decision, so you can make sure you’re covered. Our favorite rewards credit card, the Chase Sapphire Preferred® Card, offers rental car insurance with primary coverage and numerous ways to earn while you travel.
The Platinum Card® from American Express
This premium rewards card is ideal for frequent travelers who want all the travel benefits that a credit card can offer. Its insurance is valid when you use your card to pay for your rental, or when you redeem reward points for a domestic reservation made through its Membership Rewards program, so long as you decline any optional insurance offered by the rental car company.
Unfortunately, this coverage is secondary, and it does have some significant exclusions. For example, rentals in Australia, Ireland, Israel, Italy, Jamaica, and New Zealand are never covered. In addition, several types of vehicles are excluded including pickup trucks, full-size vans, and sport utility vehicles, as well as sports cars such as the Chevrolet Corvette.
However, American Express offers cardmembers an optional premium rental car insurance plan that addresses many of these issues and is also quite affordable. If you opt into this policy, you receive up to $100,000 of primary coverage against damage or theft that’s not subject to a deductible. It also covers rentals of many additional types of vehicles including luxury vehicles, full-size vans, SUVs, and pickup trucks. You can quickly enroll in the premium rental car insurance program online or over the phone, and once you do so, you will be automatically covered on all the rentals you charge to your card.
The best part of this option is that it only costs $19.95 for $75,000 of coverage or $24.95 for $100,000 of coverage ($15.95 / $17.95 for California residents; $12.25 / $15.25 for Florida residents), and it’s just charged once per rental, not per day. This is the coverage I use when traveling in the developing world, or when I’m lucky enough to get a car like a Corvette. Nevertheless, the same countries that are excluded from the standard policy are also excluded from this optional premium insurance, so it will be of no use on your next trip to Italy.
Among the numerous travel perks and benefits offered by this card, you’ll receive elite status with Avis, National, and Hertz car rentals, which will provide you with faster service, additional rewards, and vehicle upgrades. For example, National’s Executive status allows you to reserve a midsize car and choose from any vehicle in its Emerald Aisle selection, while Hertz offers four additional hours at the end of your rental when you use your Platinum card. Other compelling cardholder benefits include airport lounge access, a $200 annual statement credit toward airline fees, and a $100 credit toward the Global Entry application fee, which offers members expedited entry into the United States and access to the TSA PreCheck program. There’s a $550 annual fee for this card, and no foreign transaction fees.
Chase Sapphire Preferred® Credit Card
This popular travel rewards card is perfect for those who want to earn travel rewards, but don’t necessarily need all the benefits of an expensive premium rewards card. Furthermore, it has many advantages when it comes time to rent a car. Its coverage is primary and it covers you anywhere in the world that you rent a car — as there are no excluded countries. It also has a relatively large list of covered vehicle types that still covers pickups, SUVs, and select luxury cars.
In addition, this card offers a great rewards program that earns you double points for car rentals and all other travel purchases including airfare, hotels, and cruises. Points are earned in Chase’s Ultimate Rewards program and can be redeemed for gift cards, merchandise, cash back, and travel reservations. Or, your rewards can be transferred to airline miles or hotel points with seven different airlines and four different hotel programs. There’s a $95 annual fee for this card, and no foreign transaction fees.
Choosing a credit card with the best rental car insurance
When you look for a credit card that you will use to rent cars, there are several features that you need to consider. First, does the card offer primary or secondary coverage? Primary coverage is far superior to secondary as it’s always better if you don’t have to file a claim with your personal automobile insurance. If you file a claim with your personal insurance, you may be subject to a higher premium next time you renew.
Next, take a look at the territorial restrictions of the coverage, as many policies exclude cars rented at popular tourist destinations such as Italy, Ireland, Israel, Jamaica, and New Zealand. I’ve never been able to figure out why these particular countries tend to get excluded, even though you’ll have no problem receiving coverage in other countries that are far riskier.
You’ll also want to look at what kind of cars are excluded and the limits of the coverage. While all coverage will exclude some antique and exotic cars that you rarely see offered as rentals anyway, some will exclude common luxury cars and even pickup trucks, which are frequently available from major car rental companies.
Finally, you’ll need to examine the other rates, fees, and benefits of your card. For example, those who rent cars outside of the United States will want to avoid the 3% foreign transaction fee that many cards impose. Additionally, some credit cards even offer elite status with rental car companies as a benefit.
How a credit card’s rental car insurance works
It’s fantastic that most credit cards offer some sort of rental car insurance, but the details of this coverage can be difficult to find and hard to understand.
Here are some basic facts that apply to all credit cards with car rental insurance:
- To use a credit card’s rental car insurance, you must pay for the rental using your card (coupons are OK). And while most credit cards’ rental car insurance policies aren’t valid when you redeem points or miles for your rental, some cards, such as The Platinum Card® from American Express, offer insurance on rentals paid for with its rewards program.
- The coverage offered by credit cards will have many restrictions, which can include the types of vehicles covered, the countries where you can rent a vehicle, the duration of the rental, and the types of losses covered. Therefore, it makes sense to look through the details of your credit card’s policy before renting.
- Coverage may be primary or secondary. Secondary coverage requires you to file a claim with your personal insurance, if any, before you receive any benefit.
- The credit card’s insurance is always void when you violate any term of the rental car agreement, such as commercial use, driving on unpaved roads, or allowing an unauthorized person to drive.
The bottom line
Renting a vehicle is a wonderful convenience, but you always have to think about your liability in the event it gets damaged or stolen. By understanding how a credit card’s rental car insurance works, and choosing the right credit card to pay for your rental, you can have peace of mind when you take to the road on your next vacation.