You're renting a car. Do you need to purchase the supplemental liability insurance offered by the rental agency, or will the credit card you're paying with provide you with protection? The answer varies according to your credit card company and your particular card. While most credit cards offer collision damage coverage for rentals, that pays only to repair the vehicle, not for any medical expenses or harm caused to people.
Do Your Research
Before renting a car, check with your credit card company regarding liability coverage. You can call and speak with a representative or read your credit card agreement. If liability coverage is offered, find out the amount. If perusing the card agreement, read the fine print. If you are involved in an accident, there could be all sorts of liability-related fees and charges excluded from coverage. If you have more than one card, pay for the rental with the card offering the best coverage.
Ordinary vs. Elite Cards
Odds that a credit card offers liability coverage for rental cars increases if you have a premium card. If your credit line is only a few thousand dollars, it's more than likely you can expect only collision damage and theft coverage for rental cars, not liability.
Your Auto Insurance
If your credit card company doesn't offer rental car liability protection, that doesn't mean you have to pay for insurance from the car rental agency. If you have an auto insurance policy, it likely offers rental car liability protection. Check your policy or call your insurance agent to verify rental car liability coverage. Ask if there are any exclusions, such as the amount of time you can rent the car or coverage if you drive outside of the United States.
Secondary Liability Insurance
If your personal auto insurance policy covers your rental car liability, that doesn't mean the insurance offered by your credit card company is worthless. If your credit card company does offer complimentary rental car liability insurance, it could become the secondary liability insurance provider in case you're involved in a serious accident while driving the rental. If you also purchased liability coverage from the rental car agency, then your credit card coverage kicks in for expenses after your auto and rental policy coverage is exhausted.
- Bankrate: Does Your Credit Card Insure a Rental Car?
- U.S. News and World Report: Should You Purchase Rental Car insurance?
- New York State Office of the Attorney General: Car Rental Tip Sheet
- Creditcards: Don't Automatically Refuse Extra Rental Car Insurance Coverage
- Allstate: Should I Buy Extra Rental Car Insurance at the Counter?
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