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.
Enjoy primary car rental coverage worldwide with Chase credit cards. Image courtesy of Shutterstock.com.Best Personal 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.
Receive complimentary Hertz elite status with the United MileagePlus® Club Card. Image Credit: Hertz1. Chase Sapphire Preferred® Card
One of the best overall credit cards for car rental coverage is the Chase Sapphire Preferred.
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 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, 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 Chase 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
2. Chase Sapphire Reserve®
The Chase Sapphire Reserve comes with the same worldwide primary CDW coverage as the Chase Sapphire Preferred, 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!
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.
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 Personal 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:
1. The Platinum Card® from American Express
For luxury travel benefits, it’s difficult to beat the Amex Platinum card.
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 for more information on the car rental and insurance benefits of the Amex Platinum card.
2. Hilton Honors American Express Aspire Card
When you book your car rental with the Hilton Honors Aspire Card, 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.
Many business credit cards offer primary car rental coverage for personal rentals when out of the country. Image Credit: ShutterstockAmerican 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.
American Express offers both complimentary CDW coverage with their credit cards and premium coverage you can purchase. Image Credit: American ExpressBest Business Credit Cards for Car Rental Insurance Coverage
1. Ink Business Preferred® Credit Card
Enjoy primary worldwide CDW car rental coverage worldwide with the Ink Business Preferred Card when renting a car for business use.
Coverage becomes secondary when you rent a vehicle for personal use in the United States.
2. Ink Business Cash® Credit Card
The no-annual-fee Ink Business Cash card also comes with primary worldwide car rental coverage and secondary coverage when you rent a vehicle for personal use in the United States.
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 completed 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!
The information regarding the Hilton Honors American Express Aspire Card was independently collected by Upgraded Points and not provided nor reviewed by the issuer.
For rates and fees of the Platinum Card® from American Express, click here.