Rental Car Coverage: What Your Own Policy and Credit Card May Already Include
Before you accept the rental counter's coverage, check your personal auto policy and your credit card benefits. Here is what each typically covers, where the gaps are, and the questions to ask.
At the rental counter, you'll be offered several types of coverage. Some of it may duplicate protection you already have. Some of it may fill real gaps. Knowing which is which before you arrive saves both money and stress.
What the counter typically offers
| Product | What it generally does |
|---|---|
| Collision or loss damage waiver (CDW/LDW) | Waives your responsibility for damage to or theft of the rental car |
| Supplemental liability | Adds liability coverage above what's provided |
| Personal accident insurance | Medical and accidental death benefits for you and passengers |
| Personal effects coverage | Covers belongings stolen from the rental car |
A damage waiver isn't technically insurance; it's an agreement by the rental company not to hold you responsible for damage, subject to its terms.
Your personal auto policy
For rentals in the U.S. for personal use, many personal auto policies extend:
- liability coverage to the rental car;
- collision and comprehensive coverage, if you carry them on your own car, subject to your deductible.
Gaps to check:
- Loss of use: rental companies may charge for the days the car can't be rented while being repaired.
- Diminished value claims and administrative fees.
- International rentals, which personal policies often don't cover.
- Business use and certain vehicle types, such as large vans or luxury cars.
If you don't carry collision and comprehensive on your own car, your policy may not cover damage to the rental.
Your credit card
Some credit cards provide rental car coverage when you pay for the rental with that card and decline the rental company's damage waiver. Key differences:
- Secondary vs. primary. Many cards are secondary, paying after your personal auto policy. Some are primary.
- Covers damage and theft only. Card benefits typically don't include liability.
- Exclusions. Certain countries, vehicle types, and rental lengths are often excluded.
- Claim requirements. Documentation deadlines can be strict.
Check your card's benefits guide before you travel.
Other sources
- Travel insurance policies sometimes include rental car damage coverage.
- Umbrella policies may extend liability, depending on terms.
- Health insurance covers your own medical costs, which can make personal accident insurance redundant.
- Homeowners or renters insurance may cover your belongings outside the home, making personal effects coverage redundant.
Questions to answer before you rent
- Does my auto policy cover rental cars? Liability and physical damage?
- What would my deductible be?
- Does it cover loss of use and administrative fees?
- Does my credit card provide coverage? Primary or secondary?
- Am I renting outside the U.S. or for business?
The takeaway
You may already have much of what the rental counter sells, through your own auto policy and credit card. The common gaps are loss of use fees, international rentals, business use, and liability if you don't own a car. Check before you go, so the decision at the counter is quick.
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