Some credit cards come with interesting perks—free car rental insurance, for example. As long as you use that card to pay for the rental, you’re covered. However, that insurance might not cover as much as you think.
As Travel + Leisure points out, while some cards (like the Chase Sapphire Preferred) offer primary rental car insurance, most of them use secondary insurance. This means you actually have to go through your primary insurance if you need to file a claim. Your card will only pick up the extra fees and costs that your primary insurance doesn’t cover. CreditCards.com lists some other cards that offer primary coverage. These perks can change, though, so make sure to read your own credit card’s explanation of benefits.
There are other limitations, too.
- Collision coverage only: Most credit cards only cover collision insurance, not liability. So if you want liability, you’ll have to rely on that separately, either through the car rental company or your personal insurance policy. Value Penguin lists the policies of some cards here.
- Not all cars are covered: Certain types of vehicles, like exotic cars, trucks, or vans, may not be covered. If you use a car-sharing service like Zipcar, that’s usually not covered, either.
- Not all countries are covered: Depending on the country, your credit card insurance may not fly. Some common countries not covered: Australia, Italy, New Zealand, Ireland, Israel, and Jamaica.
- “Diminution of Value” isn’t covered: As Travel + Leisure points out, your card’s policy usually comes with a handful of exclusions, including roadside assistance. If you damage one of the cars and the rental company charges you a “diminution of value,” your credit card may not cover that, either.
The bottom line: read your credit card’s fine print to see what it does and doesn’t cover. It’s a great perk, but it may not cover as much as you think, so be prepared.
An interesting read via Lifehacker