Credit Card Rental Car Insurance: What’s Actually Covered?

If you have a credit card, it might offer cover for vehicles you rent. Understanding how this cover intersects with other rental insurance is important to ensure you get the right protection when hiring a car.

In our complete guide, we'll explore credit cards and their rental car insurance, including how it operates, so you can enjoy true peace of mind when you travel.

How does credit card rental car insurance work?

Credit card rental car insurance usually functions as secondary insurance. That means that before it kicks in, you generally need to file a claim with a primary insurer. In the case of credit card coverage, your primary insurer is often your regular auto insurer.

Here's how using credit card insurance in the event of an accident may work:

After an incident occurs, your rental car company charges you for the associated costs.
Your primary coverage, such as that offered by your auto insurer, kicks in. You can file a claim with them to cover the out-of-pocket costs you've incurred.
You then file a claim with your credit card to receive further coverage that your primary insurer doesn't cover. This could include your remaining excess, charges that exceed your policy limit or other specific costs that your auto policy excludes, like "loss of use" fees.

This cover can be potentially valuable, providing extra peace of mind when using a rental car. However, as you can tell from this breakdown, there's a lot of back-and-forth that goes into it.

Having to deal with your rental car company, primary insurer, and then your credit card provider for your cover can be time-consuming. It can also leave you out-of-pocket for a long time. This can make actually using credit card rental car insurance a frustrating experience.

What does credit card rental car insurance cover you for?

Credit card rental car insurance often includes cover for the following:

Car rental excess costs.
Cover applies for cases of damage or theft.
Some cover may apply for administrative fees imposed by car rental companies.

What's not covered in credit card rental car insurance?

Credit card rental car insurance often has a long list of exclusions or optional add-ons. This can include:

Multiple vehicle accidents.
Fire and theft.
Vandalism.
Towing.
Lockouts.
Keys.
Windscreens.
Headlights.

How to find out more about your credit card's insurance options

Credit card rental car insurance varies significantly depending on factors like the card network and the issuing bank. Don't rely on credit card rental car insurance without first being fully aware of how it covers you.

The best way to do this is to contact your card issuer directly and ask them about their cover. You might also be able to rely on resources like online guides.

Make sure to get the following key questions answered:

Is my cover primary or secondary?

In the majority of cases, credit card rental car coverage is secondary. Some credit card networks, such as American Express, do offer primary cover.

What am I covered for, and what am I not covered for?

Don't assume your credit card rental cover is completely comprehensive. There are likely to be some significant exclusions you need to know about before you make any purchasing decisions.

Should I decline cover from my rental car company?

Your credit card issuer should advise you on whether you should still buy insurance from your rental company. Outside of Canada and the United States, a basic level of coverage known as a Collision Damage Waiver (CDW) is usually built-in to the price of your rental vehicle.

Car rental companies often also offer policies known as Super Collision Damage Waivers (SCDWs). These policies are more comprehensive than CDWs from the same companies.

They can reduce your excess to zero and have a reduced number of exclusions. If you’re using credit card rental car insurance, your primary and secondary coverage might mean this cover isn't worth it for you.

You can also turn down this cover if you have purchased a RentalCover policy. Our policies are 50% cheaper than the rental companies while also offering more comprehensive cover^†. Plus, there’s nothing for you to pay in the event of a claim.

What rental vehicles and rental companies are covered?

Certain rental vehicles might not be covered by your credit card. You might also find that specific car rental companies are excluded from your credit card cover.

Is there a maximum rental period for my cover?

Make sure you understand any limits on cover for car rental durations.

Are there any destinations my cover won't apply to, or locations where my cover will change?

Credit card cover may exclude certain destinations, meaning you'll need to consider different options for cover. The type of cover you receive may also vary significantly depending on your destination of travel.

What documents and information will I need in the event of a claim?

It’s important to understand what you need when it comes time to make a credit card rental car insurance claim. This will help you know what information you need to keep a record of in the event of an incident.

In the event of a claim, your card issuer might require:

A copy of the rental company accident report.
Your rental agreement.
Your repair estimate.
A police report if applicable, such as in cases of theft.
Photographs of damage.

What are the alternatives to credit card rental car insurance?

If you don't have a credit card or don't want to rely on yours for rental car insurance, you have a number of alternatives to choose from.

For more information, check out our complete insurance comparison breakdown.

Rental company insurance

Rental car companies generally include Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) cover in the base price of a rental vehicle. This cover is not an alternative to credit card rental car insurance; it functions side-by-side with it.

However, rental car companies also offer other coverage options known as Super Collision Damage Waivers (SCDWs) or Super Loss Damage Waivers (SLDWs). These policies offer greater levels of cover in the event of an incident.

Credit card rental car insurance often sets out to allow you to turn down additional coverage from your rental car company. In some cases, cover from rental car companies might end up being an alternative worth considering.

RentalCover

For a truly comprehensive approach to rental car insurance, consider RentalCover. Our policies cover many of the common exclusions or optional add-ons you'll find with policies from car rental companies and credit cards.

All our policies include cover for:

Single vehicle accidents.
Multiple vehicle accidents.
Fire and theft.
Vandalism.
Towing.
Lockouts.
Keys.
Windscreens.
Headlights.

Our cover is 50% cheaper than rental companies^†, and there's no excess for you to pay when things go wrong. We also cover you for additional fees like towing or loss of use.

We work directly with your rental car company to settle your claims. As a result of this streamlined process, 98% of our claims are paid out in 3 days, in any currency.

If you need to make a claim with us, you can complete our easy online process in any language.

Travel insurers

You might also have a level of car insurance cover through your travel insurance policy. For example, your travel insurance policy might cover car insurance excess.

However, these policies can have many exclusions, and are often capped at lower prices than rental companies charge. These policies also often involve long waiting periods in which you are out-of-pocket.

Cover your vehicle with RentalCover

Credit card cover can be a decent perk, but it comes with its share of drawbacks. RentalCover offers cover for rental vehicles that's more comprehensive than what many credit card companies offer.

We include cover for exclusions like windscreens, tyres, underbody damage and much more. We also cover you for additional costs that rental companies might sting you with, such as loss of use fees. There's nothing for you to pay in the event of an incident.

We work directly with your rental car company to settle claims, and 98% of claims are paid out within 3 days. Get a quote today and enjoy more peace of mind on your next car rental journey.

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Hear from our car rental insurance expert

"While getting rental car insurance through your credit card can seem reassuring, these policies might not offer the right level of cover for you. They may have significant exclusions from cover, and you could still pay out-of-pocket for administrative fees.

If you plan to rely on credit card rental car insurance, make sure you fully understand your policy and all of its implications for your travels. Better yet, choose a more comprehensive option in RentalCover. RentalCover provides coverage for many items excluded from credit card insurance, and there's nothing for you to pay in the event of a claim."

Frequently asked questions

What is secondary rental car insurance?

Secondary rental car insurance refers to coverage that comes into effect after your "primary coverage". It provides additional cover on top of this primary coverage.

In the case of credit card rental car insurance, your primary insurance is generally your personal auto insurance. So, your credit card rental car insurance will come into effect after your primary insurance.

Can I get rental car insurance through a travel insurer?

Yes, rental car insurance is often available from travel insurers. However, this cover can have many exclusions. Cover from travel insurers is also often capped at a much lower level than car rental companies charge for incidents.

Does credit card rental car insurance cover a second driver?

Yes, credit card rental car insurance often covers additional drivers if they are listed as an authorised driver on your rental agreement.

What's the difference between a CDW and an LDW?

The key difference between a Collision Damage Waiver (CDW) and a Loss Damage Waiver (LDW) is that a loss damage waiver will cover theft as well as damage to a vehicle. However, it's important to note that policies sold as CDWs often do include this theft insurance as well.

How should I file a claim for credit card rental car insurance?

The process for filing a claim for credit card rental car insurance varies significantly from one card issuer to another. It will also be impacted by your primary insurance. Find out directly from your credit card company what process you need to follow, and how it involves your rental car company and primary insurer.

Often, you’ll be able to submit claims online. Keep in mind that you will often need to follow a specified timeline within which you must submit your claim with all relevant documentation.