How rental car insurance on credit cards works

It feels great to get the most out of your credit card, and that can include more than just rewards.

If your card offers rental car insurance, you may want to think about relying on that coverage the next time you hit the road. You could save yourself the added cost of buying insurance through the rental company and get the important protection you need.

Key takeaways

  • You can get rental car insurance as a perk with some credit cards.
  • Rental car insurance can cover damage to your rental car, including theft and damage incurred during collisions.
  • Credit card rental insurance can act as primary or secondary coverage, depending on your situation.
  • Coverage can differ from credit card network to credit card network and card to card.

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What is credit card rental car insurance and how does it work?

Rental car insurance is offered by some credit card networks. This insurance usually offers particular protections for cardholders, like damage to the rental car and other liabilities. However, coverage can differ from network to network and from card to card.

You can use credit card rental car insurance as either primary coverage or secondary coverage. If you choose primary coverage, the credit card insurance is taken into account first, before your personal insurance kicks in. If you go with secondary coverage, your auto insurance will be applied first, and then your credit card insurance can supplement it if necessary.

Which type of coverage you choose depends on your particular insurance policy, your preferences and what your credit card allows.

How do you use your credit card’s rental car insurance?

When you rent a car with a qualifying credit card, you may automatically have rental car insurance. This can be helpful if you want a rental car insurance policy without having to follow any extra steps at the car rental agency. And it may help you feel at ease during your trip.

To take advantage of the insurance, you’ll likely need to:

  1. Pay for the whole rental with your qualifying credit card.
  2. Avoid signing the rental car company’s auto rental collision damage waiver (CDW) insurance, keeping in mind that car rental companies often encourage you to buy this coverage.
  3. Make sure your rental period is within the coverage time limit and your rental is in a covered location.

Keep in mind that your credit card’s insurance only covers your rental car. If you crash your rental vehicle and are found to be at fault, you won’t have coverage through your credit card for damage to other vehicles or medical expenses. There may also be limits on what types of cars you can rent to be eligible.

What does credit card rental car insurance cover?

Here are some things that a credit card’s rental car insurance might offer:

  • Collision coverage: You may be covered for physical damage to your rental car in case a fender bender interrupts your trip.
  • Theft coverage: If you have rental car insurance through your credit card, it may cover theft of the vehicle.
  • Towing charge coverage: You might be reimbursed for the cost of a tow truck.
  • Loss-of-use charge coverage: If a rental vehicle is damaged, the rental company could seek compensation for what they would’ve earned from renting out the undamaged vehicle. This is called a loss-of-use charge.

But remember: Credit card rental car insurance coverage can vary from network to network and card to card.

Credit card rental car insurance FAQ

Here are some answers to common questions about credit card rental car insurance and rental car insurance in general:

You can check your credit card’s benefits guide or contact a representative to see whether your card offers rental car insurance.

When you pick up your car from a rental agency, you’ll likely be offered a rental insurance policy. 

If you have typical primary car insurance, paying for and signing this waiver may be unnecessary because most auto insurance policies will still cover you as a driver of a rental car. With a qualifying credit card, you can decline this coverage and instead use your card’s included coverage. It can be helpful to double-check with your primary insurance provider to see what’s covered.

If you go with your credit card’s rental car insurance, there are some situations that won’t be covered. However, if you pair your credit card’s rental car insurance with your personal auto insurance policy, you’ll likely be well covered.

Credit card coverage generally doesn’t include paying out claims in certain categories. So, you most likely won’t be covered through your credit card for the following:

  • You or anyone else gets physically injured.
  • You damage other vehicles or property with your rental vehicle.
  • Your luggage or other belongings are stolen from your rental vehicle.
  • You get into a collision with underinsured or uninsured motorists.
  • Your rental vehicle breaks down because of a mechanical error or general wear and tear.

If you aren’t sure exactly what’s covered, check your card’s benefits guide.

It isn’t, but some travel insurance can cover rental car damage. Travel insurance can cover more than just your rental car, and you can buy specific types, depending on what you need. People often get travel insurance to cover trip cancellations, travel interruptions, foreign medical care and more.

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Credit card rental car insurance in a nutshell

Credit card networks sometimes offer rental car insurance as a perk. This benefit can be used alongside your regular car insurance and may provide extra peace of mind on your trip. But before you use it, it’s helpful to understand exactly what’s covered by your card so you can determine whether this coverage will be adequate for your needs.

Other ways to maximize your travel benefits

Who wouldn’t want to get the most out of their credit card? Here are some things to know about Capital One travel rewards credit cards: 

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