Does your free credit card car hire excess Insurance really covers you?

Most rental companies in Europe will provide will insure your rental vehicle and will state that the price of the rental include CDW/LDW/TPI coverage. What they don’t say when you order the car is that in the event of an accident we will need to pay a certain amount which is called “excess”. However, when you pick up the car, they staff at the desk will advise you that it is recommended to purchase excess waiver insurance in order to protect you from this cost. This additional charge will typically add $15-$25 per day to your rental bill.


Many people waive this offer because they tend to think that the free insurance that is offered by their credit card will cover them.


Many credit cards offer valuable advantages like money back and reward points. Some even offer free travel insurance and a few offer auto rental insurance, which will cover you as long as you utilize that particular card to pay for the rental. If you have one of these cards, you need to realize that its rental insurance doesn’t cover as much as you may think.


Most credit cards provide secondary rental car insurance, not primary insurance. This implies it will pay just for additional expenses and costs that your primary insurance does not. If you have to file a case, you will still need to experience your primary insurer.


What is covered?

  • Collision coverage alone—most credit card insurance approaches will just cover collision, not a liability.
  • Coverage of just a few vehicles—certain kinds of vehicles, for example, trucks, vans, and exotic cars may not be covered under the policy, and car sharing services are usually not covered either.
  • Coverage of just a few nations—your credit card insurance may not cover your vehicles in certain typical traveler destinations, including Australia, Italy, New Zealand, Ireland, Israel, and Jamaica.
  • “Diminution of Value” not covered—there are typically a few special cases to what your insurance policy will cover, including roadside help. In case you’re in an accident, and the rental car company charges you a “diminution of value” fee, your credit card insurance may not cover it.


Some of the limitations are:

  • Typically, just physical harm to the rental vehicle because of a crash or burglary is covered. However, wounds to you or others are not. Your car insurance policy would cover those; if you don’t have one, you should take the rental company’s additional individual injury coverage. You can likewise purchase a car hire excess liability policy from numerous independent agencies.
  • Loss of personal things is commonly excluded.
  • Most credit cards exclude injury, property damage and damage to other vehicles.
  • While it may appear glaringly evident, the card you use to pay must be utilized for the entire rental and the bill should be for the sake of the cardholder.


Does it actually protect you?

As you can see, there are many loopholes and fine print which make gaps in coverage. This is the reason it’s so essential to check with your rental car credit card insurance policy to decide the exact coverage you have.

Carefully read your credit card’s terms and conditions to discover what it does and does not cover. Ensure that it meets your needs before you depend on it.

I would be skeptical of these insurance coverage policies that credit card offers. If you do, simply make yourself mindful of the considerable number of exclusions. Unfortunately, rental companies charge anywhere from $15 to $25 (in addition to tax!) for every day of excess waiver liability insurance coverage if you get it from them — and they’ll most likely attempt to sell it to you as the better option.

Our recommendation is to seek for an independent car hire excess insurance provider where rates drop down as low as $3.5 per day or $60-$70 for an annual policy.


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