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Many people already know that they have some kind of rental car coverage on at least one of their credit cards. Rental car insurance is a great benefit because it can save users significant money in the case of an accident, damage, or theft to the rental car.
But most people don t know that there are two types of car rental insurance — and the details live where easily overlooked information always does: in the fine print.
We re focused here on the rewards and perks that come with each card. These cards won t be worth it if you re paying interest or late fees. When using a credit card, it s important to pay your balance in full each month, make payments on time, and only spend what you can afford to pay.
There are, in fact, two kinds of rental car insurance that come with many popular rewards credit cards.
The first, and most common, is secondary insurance. Like its name suggests, secondary rental car insurance offers coverage benefits, but it s only secondary to your personal auto insurance policy. Many of these benefits allow you to decline the Collision Damage Waiver CDW andor the Loss Damage Waiver LDW. Doing so saves you about $-$ in charges tacked on to the cost of the rental.
While secondary car rental insurance is great, it is limited. In the event of damage or theft, car renters still have to file a claim through their personal auto insurance policy, and the secondary insurance is there to cover a portion of leftover costs. So, although this is a nice perk, it doesn t ease the sting of auto insurance premiums rising, which can happen depending on your policy. If this were to happen, you would probably wish you just opted for the CDW and LDW from the start.
That s why it s ideal to have a credit card with primary car rental insurance. Primary car rental insurance is the gold standard of car rental benefits, and it s available on many credit cards.
Primary car rental insurance means that coverage for loss or damage will be taken care of by the credit card company, without you having to make a claim with your personal policy. In the long run, this could save a car renter significantly on both CDW and LDW, and it could help avoid raising premiums on their personal auto policy.
There are some important things to remember to get the most out of your credit card s car rental insurance benefits.
For starters, you must pay for the entire transaction with the credit card you d be filing the insurance under. Some cards even require that renters are booking the entire trip on the card, so read the fine print carefully.Second, this primary insurance generally doesn t include liability, or damage to other cars, damage of personal property, personal bodily injury, and injury to other persons. See Business Insider s guide to shopping for auto insurance to get this liability coverage.Third, check for not-so-obvious limitations on coverage. For example, if you re traveling between countries, you will need to know if the coverage extend to those areas.In addition, some primary insurance benefits have limited rental periods, so check how long your coverage lasts.Perhaps the most unexpected limitation is on the type of car. Before assuming you re covered, check to see if your car has any constraints on make and model.If you re using a business credit card that offers primary car rental insurance, you need to be renting a car for business purposes in order to receive the coverage.
Once you know the important details of your trip, you can call or chat with your credit card issuer to find out if you re covered with your card s benefits. Remember to be clear about where you re going, what type of vehicle you are renting, and how long you plan to rent it.
Finally, regardless of coverage, you should always snap a few pictures of the vehicle when you pick it up and drop of off in case there is a dispute over damage.
You can pay for primary coverage with any of your American Express cards. The The Platinum Card® from American Express is a good option thanks to the tremendous amount of value it offers to offset its annual fee.
Capital One® Spark® Cash for Business— earns % cash back on every purchase, $ annual fee that s waived the first yearCapital One® Spark® Miles for Business — earns miles per dollar on every purchase, $ annual fee that s waived the first year
Remember that you need to be renting a car for a business purpose for the coverage to be applicable when you pay with either of these two cards.
Chase offers several cards with primary car rental insurance, including some of our favorite travel rewards cards overall.
Chase Sapphire Preferred® Card — This is a great travel rewards card with a reasonable annual fee of $. It earns points per dollar on travel and dining purchases, and point per dollar on everything else. It s currently offering a sign-up bonus of , Chase Ultimate Rewards points after you spend $, in the first three months of account opening.
Chase Sapphire Reserve® — This is the more premium sibling of the Sapphire Preferred Card. It has a $ annual fee and includes high-end benefits like up to a $ annual travel credit, a Priority Pass Select membership for airport lounge access and x points earnings on travel and dining excluding the $ travel credit. It s offering a sign-up bonus of , points after you spend $, in the first three months of account opening.
United℠ Explorer Card — If you travel with United a few times a year, this card can be worth it thanks to benefits like a free checked bag and access to additional saver-level award space. It has a $ annual fee that s waived the first year.
Ink Business Preferred® Credit Card — This card has one of the highest sign-up bonuses among Chase cards: , Chase points after you spend $, in the first three months of account opening. It has a $ annual fee.
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Please note: While the offers mentioned above are accurate at the time of publication, they re subject to change at any time and may have changed, or may no longer be available.