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If you've ever rented a car, you've probably received the hard sell on purchasing insurance as part of the rental agreement. The fee can range anywhere from $10 to $50 per day, depending on the provider, your age, the country where you're renting, the coverage offered, and the type of car you'll be driving. The good news? You might not need to pay to get Collision Damage Waiver (CDW) insurance on your rental car.
Many travelers may not realize that they already carry a credit card that provides rental car insurance. Several credit cards cover cardholders against damage caused due to theft or accidents. Coverage usually comes in the form of reimbursement after you pay for any losses.
A question we get regularly, both in blog comments and AwardWallet’s Facebook community Award Travel 101, is “How do I obtain proof of the CDW offered by my credit card company?” The answer is as simple as making a phone call. But before we jump into the details, let's review some of the basics of Auto Rental CDW policies offered by major card providers.
The auto rental coverage offered by your credit card takes the place of the traditional Collision Damage Waiver (CDW), sometimes called Loss Damage Waiver (LDW), provided by the rental company. Getting this insurance through your card can save you hundreds of dollars in additional fees.
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How do you get this coverage when renting a car? Just use the card offering the highest level of coverage to pay for your rental car. Damage to the vehicle is automatically covered in the event of an accident or if the car is stolen. You will need to follow a few rules.
To take advantage of the CDW policy provided by your credit card, you must:
You will need to check your card’s guide to benefits to determine what coverage is offered. Only a select group of credit cards offer primary rental coverage. Additionally, each credit card issuer has its own rules about what types of cars or countries are excluded from the policy.
Some of our favorite cards providing primary rental CDW include:
You'll notice that there is only one Citi card on this list. In 2019, Citi cut back many of its card benefits. Car rental coverage was one of the casualties. It was recently restored to the Citi Strata Premier during its revamp.
Additionally, some cards offer a CDW but are no longer available to new cardholders:
It's important to note that the CDW policy provided through credit cards does provide liability insurance if another person or their property is damaged in a crash. You’ll need to confirm that this is covered by your car insurance policy at home or your travel insurance. Alternatively, you can purchase supplemental liability insurance from the rental company.
We also want to note that there are business credit cards like the Ink Business Preferred ® Credit Card and the Capital One Spark Cash Plus that offer rental car coverage. However, the primary coverage is intended for rentals on business trips. If you rent a car for personal use and have an accident, you could get stuck with the bill. It's important to confirm the details with your specific cardholder so you're clear on what's covered.
Lastly, there are some common exclusions when it comes to CDW coverage:
Most American Express cards offer car rental insurance coverage; however, it is secondary coverage, not primary. The Amex website has a full list of car rental insurance policies for each card. Luckily, Amex cardmembers can purchase Premium Car Rental Protection. For a modest fee of $12.25 to $24.95 per rental period — not per day — you'll get primary damage coverage.
This coverage also includes accidental death and dismemberment, secondary medical expense coverage, and secondary personal property coverage.
In most cases, you aren’t required to show proof of the CDW offered with your card. However, many rental agencies, particularly those in other countries, have little (or no) knowledge of the benefits of U.S.-issued credit cards. We frequently hear stories of travelers being forced to take out additional coverage when they can’t present proof of the policy and what it covers.
If the rental company is not happy with the evidence supplied, you can find yourself paying unwanted fees for insurance you don’t need. Even worse, the rental agency may place a significant hold on your credit card until you return the vehicle. This ties up money on your card and throws your credit utilization rate under the bus.
What should you do to prevent that mess? Get a letter of coverage as a precaution. The easiest and fastest way to obtain proof of coverage from your credit card provider is to call the Benefits Administrator and request it. You will call and ask for a proof-of-coverage letter stating which countries the policy covers and what types of damage/loss it covers. Print the letter, and take it with you to the rental agency when you pick up the vehicle.
Here are the numbers you may need:
Requesting a letter of coverage from your credit card provider takes a few minutes and gives you proof of rental car insurance. Doing so can save massive headaches and hundreds of dollars when renting vehicles — both domestically and abroad. Just be sure to read the policy offered on the card and check all the fine print, so you aren't left to foot the bill in case of an accident or theft.
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