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Credit Cards and Auto Insurance

When people rent vehicles, they often pay for the purchase using credit cards, for the convenience as much as for any other reason. We have heard many times that it is good to use caution before agreeing to the rental car insurance coverage offered by the car rental company. And there is some degree of common knowledge that credit card companies themselves actually offer rental car insurance protection in some cases if the car is rented using the card. But it is equally important for consumers to be wary of this coverage as it is for them to be skeptical of the protection offered by car rental companies when they go to rent a vehicle. The truth is that as a consumer, you need to protect yourself by understanding what is needed and what isn't so that you do not end up wasting your money.

Credit Card Auto Insurance Has Value

Many drivers do not even worry about bothering with the extra protection offered to them by car rental agencies because they pay by credit card and are covered by the terms of their card holder agreement. Certain credit card companies offer at least some card holder accounts that include provisions for rental car coverage. Some of them are actually automatically applied if the car is rented using these cards. The average cost of the insurance rental car companies try to sell consumers can vary widely, but it can add up in a hurry, especially if the rental is going to last more than a few days. It is crucial to think ahead of time and look into your own car insurance policy as well as the terms of your credit card agreement to discover whether either one or the other (or maybe both) include real protection for you as a driver if you rent a car.

Credit card auto insurance does have value because it often offers for free what consumers have to pay for when they deal with car rental companies. Having that extra coverage is great for good old peace of mind, but it is impractical and a waste of money to buy this insurance if your card holder agreement truly includes provisions for adequate coverage at no extra cost to you. The trick is to find out the real terms of your agreement and to find out what these terms really say about whether this protection really comes at zero cost, and what kind of coverage it really includes for you as a driver and a renter.

Many people who are card holders with accounts that purport to include free rental car coverage do not even worry about adding that extra insurance the rental agencies try to add, because they are confident that they are already covered so they do not need any more protection as drivers and renters. While this may be absolutely true, it is important for you to always make sure of it before you bank on it. Do not make a choice not to insure unless you are 100 percent certain that you do not need to be insured.

Personal Auto Insurance Rental Coverage

Before getting too far into any discussion of whether or not to add extra protection at an extra cost when you rent, the first thing you should do as a driver is not to check the specifics of the credit card policy, but of your auto insurance policy. Many auto plans really do come with rental coverage and with coverage for non owned vehicles in general. This would cover borrowed vehicles as well as rented.

Once the presence of this protection on the quotes of the driver's auto policy is established, the next thing to do would be to check into the credit card agreement. Many of these card agreements have what is known as secondary rental insurance coverage. Any auto insurance that is secondary in nature basically does not go into effect at all until all other insurance protection has been used up. Credit card rental car insurance often is secondary and only allows claims to be made once the card holder's personal policy has been exhausted.

Loss of Use Rental Insurance

One very important area to look into when you're making the choice not to buy the insurance protection offered by the rental car company is in regard to loss of use coverage. Basically, what loss of use does is reimburse the rental car agency for the income they would have gotten on a car during the time for which it was out of commission in an accident. Rental agencies will offer this as a part of the insurance they'll try to sell, but auto insurance and credit card companies' policies do not necessarily include this protection. Check to make sure it is included.


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