The Best Credit Cards for Car Rental Insurance Coverage

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When renting a vehicle you’re faced with several decisions. Should I get that GPS, prepay for gas, or take that automatic toll-paying sensor? Should I spend a few extra dollars and get the full-size car?

The decisions are many…and the salesperson is a professional at the up-sell. Stress starts to set in, but some of the most expensive decisions are yet to be made.

One of the most expensive decisions to make is whether to opt for the rental car company’s collision/loss damage waiver coverage.

This coverage can cost as much as $30 per rental day, and you may have a difficult time opting out of it.

In the worst case scenario, you might opt out and have something happen to your rental. You could be out thousands of dollars until you resolve the issue between the rental car company and your insurance company.

Even then, you could be left with a high deductible to pay.

However, there is some available relief to this madness — and you may already have access to the solution! By knowing the extent of any car rental coverage you have on your credit cards, you can save yourself stress and a lot of money.

While the collision damage waiver (CDW) (or loss damage waiver/LDW, as it is sometimes called) is not technically insurance, it functions similarly. And it can also be just as confusing!

But not to worry — as usual, we’ve done the work for you and put together a collection of some of the best credit card rental car coverage out there.

In this article we’ll cover:

  • What is collision damage waiver coverage
  • Which credit cards offer the best protection
  • What you need to know to file a claim

Let’s get started with our overview of credit card rental car coverage and take a look at some of the best credit cards to use when renting a vehicle.

What Is the Car Rental Collision Damage Waiver?

Car Rental Collision Damage Waiver

The Car Rental Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) is coverage that reimburses you for damage to your rental car or theft of the car while the vehicle is in your custody.

It can also cover “loss of use” of the rental car, which car rental agencies can charge you if the vehicle is damaged or stolen. (Since the vehicle wouldn’t be available to rent out, the agency could be losing revenue and pass this loss on to you.)

Car rental companies require you to purchase CDW/LDW coverage before you take possession of the rental car, unless you have the coverage elsewhere.

Several credit cards provide CDW coverage at no extra charge, and if you have this coverage you can decline the expensive car rental company option.

Primary vs. Secondary Coverage

While many credit cards offer CDW coverage, there can be a significant difference in how the coverage functions.

  • Secondary CDW Coverage: If your credit card offers secondary CDW coverage, you will need to first file a claim with any other available insurance before the secondary coverage kicks in.
  • Primary CDW Coverage: Provides coverage without the need to file a claim with other insurance. If an incident happens, the primary coverage applies.

Hot Tip: Note that coverage on the same credit card can be secondary in certain countries and circumstances while primary in others. Check with your card’s benefits administrator for specific questions.

Requirements to Ensure Coverage

For the CDW coverage that is offered on credit cards to be valid, most credit card coverage requires the following:

  • Reserve and pay for your rental car with the qualifying credit card
  • Decline the rental car company’s CDW/LDW coverage
  • List all drivers on the rental agreement

Make sure you know the requirements before you rent a vehicle, and call the benefits administrator if you have questions.

You can even ask for a letter showing your CDW coverage to show when renting a vehicle.

Bottom Line: Your credit card guide to benefits will be very specific in explaining the definition of the card’s particular CDW coverage. It will also provide clear information on where and when coverage is secondary or primary. 

Towing
Enjoy primary car rental coverage worldwide with Chase credit cards. Image courtesy of Shutterstock.com.

Best Chase Credit Cards for Car Rental Insurance Coverage

Chase excels in offering car rental coverage by providing worldwide primary CDW coverage complimentary with its credit cards.

Chase Sapphire Preferred® Card

One of the best overall credit cards for car rental coverage is the Chase Sapphire Preferred® Card.

Not only will you be earning 2 Ultimate Rewards Points per dollar spent on your car rental (and all other travel), but you’ll have peace of mind knowing you have primary CDW coverage worldwide.

What’s Covered

The Chase Sapphire Preferred® Card and any Chase credit cards offering CDW coverage come with primary coverage. This means you won’t have to worry about filing a claim with your auto insurance company if something should happen to the rental vehicle.

You can expect the following coverage worldwide with your Chase credit card:

  • Reimbursement for damage or theft of the rental car up to the actual cash value of the vehicle
  • Valid loss of use charges assessed by the rental car company
  • Reasonable towing charges
  • Rentals are covered for 31 days or less

Who’s Covered

  • Primary cardholders and authorized users
  • Additional drivers listed on the rental agreement

Hot Tip: There is no charge for adding an authorized user to the Chase Sapphire Preferred® Card, and they receive the same primary CDW coverage when renting a vehicle with their card! Keep in mind that authorized users driving a vehicle rented by the primary cardholder do need to be listed as a driver to be covered. Read more about maximizing car rental insurance benefits with the Sapphire Preferred®.

What’s Excluded

  • Certain luxury, antique, and exotic vehicles
  • Cargo vans, motorcycles, recreational vehicles
  • Certain countries may be excluded where prohibited by law
  • Liability coverage

Chase Sapphire Reserve®

The Chase Sapphire Reserve® comes with the same worldwide primary CDW coverage as the Chase Sapphire Preferred® Card, but with a maximum of $75,000 coverage for the rental vehicle.

The most compelling reason to use the Chase Sapphire Reserve® for your rental car is that you can pay for the rental with Ultimate Rewards Points and receive 50% more value for your points!

Credit CardCard Overview
Chase Sapphire Reserve®

Chase Sapphire Reserve®
  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening.
  • That's $750 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year
  • 3X points on travel immediately after earning your $300 travel credit. 3X points on dining at restaurants.
  • Access to 1,000+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select
  • Annual Fee: $450

If you choose to charge the car rental to your Chase Sapphire Reserve®, you’ll earn 3 Ultimate Rewards Points per dollar spent.

You can also pay with points in advance or reserve with your card and use the Chase Sapphire Reserve® when you check-in at the rental counter — you’ll be covered for primary CDW coverage.

With this card, you also receive elite status with National Car Rental and Avis, plus a 30% discount on Silvercar rentals.

Hertz car rental
Receive complimentary Hertz elite status with the United MileagePlus® Club Card. Image courtesy of Hertz.

United MileagePlus® Club Card

For travelers who fly United Airlines and frequently rent cars with Hertz, the United MileagePlus® Club Card could offer great value.

The card offers priority check-in, security screening, boarding, and baggage handling privileges — plus it comes with complimentary Hertz President’s Circle elite status!

Here, you’ll receive the same primary CDW rental car coverage as the Chase Sapphire Preferred® Card, plus a myriad of premium travel benefits including United Club lounge membership.

Bottom Line: Chase credit cards are a great choice to use when renting a car because they offer complimentary worldwide primary CDW rental car coverage for rentals of 31 days or less. 

Best Amex Credit Cards for Car Rental Insurance Coverage

Most American Express credit cards come with complimentary secondary CDW coverage and allow you to purchase optional Premium Car Rental Protection.

This means that American Express credit cards are basically created equal when it comes to CDW coverage.

As a result, it makes sense to use an American Express card that delivers premium travel benefits and earns flexible points or hotel rewards when renting a vehicle. Here’s what we suggest:

The Platinum Card® from American Express

For luxury travel benefits, it’s difficult to beat the Platinum Card® from American Express.

Plus, you’ll receive special benefits, discounts, and elite status with Hertz, Avis, and National Car Rental.

Airline tickets and hotels earn 5 valuable Membership Rewards Points per dollar spent, and points can be transferred to travel partners.

Use the complimentary secondary CDW that comes with the card, or opt for Premium Car Rental Protection for primary coverage.

Hot Tip: Don’t miss our dedicated article on the subject for more information on the Platinum Card car rental benefits and insurance

Hilton Honors Aspire Credit Card from American Express

When you book your car rental with the Hilton Honors Aspire Credit Card from American Express, you’ll be earning 7 Hilton Honors Points per dollar spent.

You’ll also have the option to enroll the card and purchase Premium Car Rental Protection, or use the complimentary secondary CDW coverage that comes with the card.

The card offers premium travel benefits including lounge access, elite status, resort credits, airline credits, and an annual free night.

American Express Car Rental Coverage

American Express is unique in its offering of CDW coverage on its credit cards.  The card issuer offers both complimentary secondary CDW that comes with their credit cards, and primary Premium Car Rental Protection that can be purchased.

  • Standard complimentary secondary CDW coverage included with its credit cards
  • The option to enroll your credit card in advance for primary Premium Car Rental Protection that’s automatically applied when you use the card to rent a vehicle

American Express Complimentary Secondary CDW Coverage

Complimentary CDW is included on most American Express credit cards. But for the complimentary CDW coverage to be effective, the following must be done:

  • Reserve and pay for the entire car rental with the qualifying American Express card
  • Decline the car rental company’s CDW/LDW coverage

To find out if your American Express credit card has complimentary CDW coverage, review your benefits guide here.

What’s Covered

  • Damage or theft of a rental vehicle up to a maximum of $50,000
  • Loss of use, appraisal fees, towing
  • Rentals of 30 days or less

Who’s Covered

Drivers covered for CDW under the complimentary coverage on your credit card include:

  • Primary cardholders and additional drivers listed on the rental agreement
  • Authorized users and additional drivers listed on the rental agreement

For CDW coverage to apply, the car rental must be reserved and paid for with the American Express card.

Exclusions

  • Cars rented in Australia, Italy, New Zealand, or any OFAC listed country (due to economic or trade sanctions)

American Express Optional Primary Premium Car Rental Protection

To purchase Premium Car Rental Protection, you will need to enroll your American Express credit card in advance of your car rental.

Once you use your card to reserve and pay for the car rental after enrollment, the coverage is charged to your card and becomes effective for that rental term.

This coverage is primary when purchased, meaning you do not need to submit a claim with another insurance company first.

There are 2 levels of Premium Car Rental Protection available, and they range in price from $12.25 to $24.95 depending on the state you reside in and the limits of coverage you select.

The price you pay is for the entire rental period (up to 42 days), not a per day charge!

What’s Covered

  • Damage or theft of your rental car for up to $100,000
  • Secondary medical coverage and accidental death benefit for driver/passengers
  • Personal property coverage

Who’s Covered

  • The primary cardholder and drivers listed on the rental agreement
  • Authorized users and accompanying drivers listed on the rental agreement

What’s Not Covered

To access the terms/conditions of the basic CDW coverage that comes with your American Express credit card, view the guide to benefits for all 58 cards here. To register your American Express card for Premium Car Rental Protection, visit the registration page.

Hot Tip: If you’re renting a vehicle for more than 30 days, the Premium Car Rental Protection for purchase with your American Express credit card is a great value. You receive primary CDW coverage for pennies per rental day and are covered for up to 42 days. 

Car on highway
Many business credit cards offer primary car rental coverage for personal rentals when out of the country. Image courtesy of Shutterstock.

Best Citi Credit Cards for Car Rental Insurance Coverage

Citi credit cards provide secondary CDW coverage only for car rentals in the United States. This means that you’d have to file a claim with your auto insurance company first.

However, outside of the country their CDW coverage is primary  — and your Citi credit cards with no foreign transaction fees become an option for international car rentals.

Citi ThankYou® Premier Card

Earn 3X ThankYou Points on travel including car rentals, and get secondary CDW car rental coverage for U.S. car rentals (primary CDW for international car rentals).

What’s Covered

  • Coverage is valid worldwide
  • Damage or theft of the rental car up to $50,000
  • Rental period of no more than 31 days
  • Reasonable towing charges
  • “The rental car is a motor vehicle with at least four wheels that is
    designed to be driven on public roads”

Who’s Covered

  • Primary cardholder and drivers listed on your rental agreement

What’s Not Covered

  • Liability insurance
  • Loss of use of the rental car

You can access the complete guide to benefits, including Citi CDW car rental coverage, .

Bottom Line: While Citi credit cards do have car rental coverage that comes with their cards, it is secondary coverage in the U.S. and excludes any loss of use due to theft or accident of the rental car. While the coverage is primary for international rentals, not having loss of use coverage could cost you. 

Amex car rental insurance
American Express offers both complimentary CDW coverage with their credit cards and premium coverage you can purchase. Image courtesy of American Express.

Best Business Credit Cards for Car Rental Insurance Coverage

Ink Business Preferred℠ Credit Card

Enjoy primary worldwide CDW car rental coverage worldwide with the Ink Business℠ Preferred Credit Card when renting a car for business use.

Coverage becomes secondary when you rent a vehicle for personal use in the United States.

CitiBusiness® / AAdvantage® Platinum Select® World Mastercard®

The CitiBusiness® / AAdvantage® Platinum Select® World Mastercard® offers primary CDW coverage outside the U.S. and secondary coverage domestically.

The card offers:

  • Coverage for damage to your rental car and theft of the car up to $100,000
  • Earnings of 2 miles per dollar for rental car purchases
  • Free checked bags on American flights
  • $99 companion pass when your business reaches $30,000 in spending each year

SimplyCash® Plus Business Card from American Express

Select rental car purchases from “specific major car rental companies” as your custom cash-back bonus category, and you’ll be earning 3% cash-back on every car rental!

Use the complimentary secondary CDW coverage that comes with the card, or register your card and purchase primary Premium Car Rental Coverage.

General Tips for Filing a CDW Coverage Claim

The first step when your rental car is in an accident or stolen is to call the benefits administrator.

You’ll be asked some questions and sent a claim form to complete.

Be aware that when submitting a CDW claim, you’ll have deadlines to meet, documentation to gather, and a responsibility to follow up.

Hot Tip: Since most claims will be processed on a reimbursement basis, you’ll likely have plenty of incentive to get your claim processed quickly!

Know the Deadlines

There will be specific deadlines at each step of the process, which you should familiarize yourself with. Here are a few to look out for:

  • Reporting the claim
  • Submitting the completed claim form
  • Submitting all required documents

Gather All Relevant Information

Don’t forget to gather information when the accident/theft happens — some items may be difficult to obtain later. Here’s what you might need:

  • Copy of the entire rental agreement
  • Copy of the accident report from the car rental company showing the amount you owe
  • Police report
  • Photos of the damage

Follow up With Additional Needed Documents

If the claim administrator asks for anything else, make sure to provide it right away. For example, they might request:

  • Copy of your credit card statement showing that the rental was paid for with your qualifying credit card
  • Repair estimates

Ask for Assistance

If you have trouble getting the required documents, ask the claim administrator for help.

Final Follow Up

It’s your responsibility to make sure all of the required documentation is received by the claim administrator on time and is complete to their satisfaction.

Generally, if you have primary CDW coverage or secondary CDW coverage with no current auto insurance, the claim process will be straightforward.

But if you have secondary CDW coverage that applies to the rental car incident and you have auto insurance as well, you will need to report the claim to that company first.

Hot Tip: Be aware in advance of what you’ll need to do in case of a rental car incident, so you’ll be prepared to gather as much documentation as possible when the incident happens. Photos, police reports, and documentation from the rental car company can be impossible or difficult to obtain later on.  

Final Thoughts

If you have your own car insurance, the best CDW coverage for domestic car rentals is primary credit card CDW coverage.

This is because it’s best to avoid filing a claim with your own insurance company, which could mean potentially having to pay a high deductible and having your rates increased.

Generally, those who carry auto insurance can get by with secondary CDW coverage when renting a car out of the country — chances are your U.S. policy will not cover you there.

The secondary CDW coverage on your credit card would then become primary.

If you do not carry auto insurance, you can get by with secondary CDW coverage, since it will act as your primary insurance in nearly all rental car situations (foreign or domestic).

You may, however, be responsible for a deductible on the car rental company’s coverage.

Call your benefits administrator for clarification of coverage before renting any vehicle.

In all cases, you should purchase liability insurance from the rental car company or be sure it is included in your rental agreement, as it is not included in CDW coverage that comes with your credit card.

If you frequently rent a car, you can save time, frustration, and money knowing the type of coverage you have with your credit cards!


Featured Image: Courtesy of Shutterstock,com

FAQ

Which is the best credit card to use for car rentals?

Having a credit card such as those issued by Chase that offer primary CDW insurance is ideal.

However, if you are renting a vehicle for more than 30 days, purchasing Premium Car Rental Insurance as a cardholder of an American Express card can be a wise choice.

The Premium Car Rental Protection covers you for pennies per day and can be valid for up to 42 days.

What does primary and secondary coverage mean?

Primary CDW coverage covers you without having to file a claim with another insurance company first.

Secondary CDW coverage requires that you file a claim with your own auto insurance company (or other insurance company that applies) and exhaust any coverage there before the secondary coverage kicks in.

CDW coverage that comes with your credit card is frequently secondary, but some credit cards (such as those issued by Chase) offer primary coverage.

Additionally, some business credit cards offer secondary coverage for personal car rentals in the U.S. but primary coverage internationally.

Which credit card has the best car rental coverage if I don't have auto insurance?

If you do not have current auto insurance, ideally you should secure a credit card that provides primary car rental coverage.

With this said, many credit cards with secondary CDW coverage allow the coverage to become primary when you do not have current auto insurance.

However, when renting a vehicle, if you want to decline the rental company’s CDW/LDW coverage, you may have to show proof that you have other coverage.

You will want to contact the benefits administrator in advance to confirm that you would indeed be covered and that the coverage would default to primary.

Can I pay for the car rental with points and still have rental car coverage?

Yes. If you use points to pay for all or part of your car rental, use your qualifying credit card to pay the remainder, and then present your card at the rental car agency, you will be covered.

Keep in mind that you need to use points from the qualifying credit card to reserve and/or pay for the car rental.

Christine Krzyszton

About Christine Krzyszton

Christine, who lives in Northern Michigan, travels about 300,000 miles a year despite her remote location. Her expertise is traveling the world on a weekend with no pre-determined destination in mind, letting the cost of the airfare determine where she will go. She has over four million flown miles and elite status on all three major domestic carriers.

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10 comments

  1. Francisco Pham · April 9, 2019 · Reply

    You stated “In all cases, you should purchase liability insurance from the rental car company or be sure it is included in your rental agreement, as it is not included in CDW coverage that comes with your credit card.” Is that the same coverage we buy from the car rental place? If so, what is the point of this article on having cdw on our credit cards if you want us to still buy the car rental agency’s insurance?

    • Christine Krzyszton · April 9, 2019 · Reply

      Hi Francisco. The Auto Rental CDW benefit that comes with your credit card provides reimbursement for damage due to collision or theft of the rental vehicle. For this reason you should refuse the rental car company’s CDW (collision damage waiver) coverage. You will save the cost of the rental agency’s coverage by doing so when you have CDW coverage with your credit card. You should, however, not decline the rental car company’s liability coverage. Liability coverage can cover any damage you might do to people’s vehicles or medical costs for other people’s injuries if you cause an accident and are held liable. CDW coverage normally excludes liability so you need to have it. The good news is that liability coverage is included automatically in most rental car agreements or for minimal additional cost.

  2. Angela M. · April 19, 2019 · Reply

    I have USAA liability coverage, not full coverage on my own vehicle. Does that liability transfer over to the rental car automatically if I’m the driver?

    • Katie Seemann · April 20, 2019 · Reply

      Hi Angela,

      I would suggest checking your specific policy to see whether it covers rental cars too. Without knowing the specifics of your policy I can’t say whether or not you would need additional coverage.

  3. Wish you had compared the USBank Altitude Reserve (I know nothing about the other USBank cards). Possibly in a future comparison? I am loving so much about this card. Knowing which card best suits my needs when renting a car makes for a really useful article. Thank you.

    • Christine Krzyszton · April 22, 2019 · Reply

      Hi Terry and thanks for your comment. I think it’s an excellent suggestion to include the U.S. Bank Altitude Reserve in future articles. Glad you found some of the information useful.

  4. Jerry Mandel · April 22, 2019 · Reply

    When flying on AA, you can save a lot of money by buying from AA.

  5. This is probably the best article on car rental insurance coverage I’ve read. In particular, your answer to the question about third party liability coverage was spot on. Many people do not understand the different types of coverage and simply overspend at the car rental counter since they don’t take the time to ask questions or research their options. There’s a lot of misinformation on social media especially Facebook as a result. Thanks for taking the time to explore this important topic for everyone.

    • So glad you enjoyed it, Steve! Feel free to share with family and friends that you think may benefit from the info! 🙂

    • Christine Krzyszton · April 23, 2019 · Reply

      Hi Steve. Glad you appreciated the article. Thank you for taking the time to give us feedback and for reading.

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