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Credit Cards That Offer Primary Car Rental Coverage

by on August 8, 2014 · 31 comments

in American Express, Chase, Citi, Credit Cards, Discover, Fairmont, Ritz-Carlton, ThankYou Points, Visa

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As I’ve discussed in previous posts, two valuable (but often overlooked) benefits of credit cards are travel insurance and secondary auto rental insurance, even though terms are sometimes poorly disclosed and policies can be inadequate. For instance, when you’re covered  by secondary car rental insurance provided by your credit card and you damage a rental car in the US, you’ll still have to file a claim with your own car insurance company - something most drivers want to avoid like the plague. Fortunately, there are several credit cards on the market that offer primary car rental insurance, providing immediate and direct coverage to the driver of a rental car.

While some credit cards only offer secondary insurance coverage for rental cars, some provide primary coverage - for more peace of mind. (Image courtesy of Shutterstock)

While most credit cards offer only secondary insurance coverage for rental cars, some provide primary coverage for more peace of mind. (Image courtesy of Shutterstock.)

Car rental coverage provided by credit cards is called the Collision Damage Waiver (CDW). Secondary CDW coverage waives your rental car agency’s right to pursue you for damages incurred to your rental car as a result of theft, vandalism, etc. However, secondary coverage may come with a deductible (typically $500), and in most cases doesn’t cover administrative fees or total loss of the vehicle due to an accident. Secondary CDW coverage is offered by a variety of cards issued by Discover, American Express (e.g., Premier Rewards Gold) and Visa (e.g., Citi Hilton HHonors Reserve).

Primary rental car coverage provided by a credit card generally covers the loss of the vehicle, meaning you won’t need to 1) pay a rental car company an extra fee for coverage when renting a vehicle or 2) alert your car insurance company to any activity that could cause your premium to increase.

Most of these policies exclude certain countries from coverage - most commonly Australia, New Zealand, Jamaica, Israel, Ireland and Italy. All policies cover most private passenger automobiles, minivans, and sport utility vehicles, but often don’t cover sports and specialty vehicles like trucks, motorcycles, mopeds and motorbikes. Excluded across the board are cars considered antique (generally defined as any vehicle over 20 years old, or one that hasn’t been manufactured for 10 years or more) or exotic (e.g., Aston Martin, Porsche and Ferrari). In all cases, in order to receive primary car rental insurance via a credit card, you have to decline the rental agency’s CDW. The following credit cards presently offer primary auto insurance coverage.

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American Express Cards. All American Express cards offer premium primary coverage for $24.95 (or $17.95 for California residents) for a rental period of up to 42 days. However, know that when you enroll an Amex card for this coverage, you give Amex consent to charge your card automatically each time you use it to rent a car; if coverage won’t be necessary for your travel needs, be sure to disenroll your card prior to your trip.

One of the best current offers on an Amex card is 40,000 points after you spend $3,000 on purchases in the first 3 months with an Amex PlatinumThis card, which incurs no foreign transaction fees, comes with a $450 annual fee, but you can receive up to a $200 airline fee credit annually for airline incidental fees like checked bags, flight-change fees and snacks. 

Chase Ink Bold and Ink Plus. Both of these business cards offer primary rental car coverage for most types of vehicles (with the exception of sports cars, trucks and off-road vehicles) in most countries except Ireland, Israel and Jamaica. Note that cardholders must be driving for business in order to be covered.

Both of these cards earn 50,000 bonus points after you spend $5,000 in the first 3 months, or $625 toward travel when you redeem through Chase Ultimate Rewards. On both cards, you’ll earn 5 points per dollar (up to $50,000 annually) spent at office supply stores and on cellular, landline, internet and cable TV services. In addition, you’ll earn 2 points per dollar at gas stations and hotel stays (up to $50,000 annually) and 1 point per dollar on all other purchases. Ink Bold must be paid off in full each month, while Ink Plus allows the flexibility of paying over time. Both of these cards incur no foreign transaction fees, and their respective $95 annual fees are waived for the first year. 

The Chase Sapphire Preferred is one of my all-time top credit card recommendations.

Chase Sapphire Preferred. Just recently, Chase announced a change in the Sapphire Preferred CDW coverage from secondary to primary insurance. Rentals paid for with the Sapphire Preferred are now covered for losses including physical damage and/or theft of the rental vehicle, valid loss-of-use charges assessed by the rental company, and reasonable and customary towing charges related to a covered loss. Reimbursement is up to the actual cash value of the vehicle as it was originally manufactured. While expensive/exotic cars are generally excluded, exceptions include select models of BMW, Mercedes-Benz, Cadillac and Lincoln.

The present signup offer for this card is 40,000 points after you spend $3,000 in the first 3 months, and the $95 annual fee is waived the first year. This card is one of my favorites, due to its 2x earnings for every dollar spent on travel and dining, and its lack of foreign transaction fees. Note that along with the addition of primary auto coverage, Sapphire Preferred has also added trip interruption and cancellation insurance, though it  eliminated the 7% annual points dividend.

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Citi ThankYou PremierCiti ThankYou Preferred and Citi Prestige. These cards provide CDW coverage up to $50,000 worldwide for most vehicle rentals of up to 31 consecutive days.

The current sign-up offer for ThankYou Premier  is 20,000 ThankYou points after $2,000 in purchases within the first 3 months, and you can also earn an additional 30,000 points after spending $3,000 within the first 3 months of your second year of being a cardmember. The card earns 3 ThankYou points per $1 spent on dining out and entertainment, 2 points per $1 spent on airfare and hotels, and 1 point per dollar on all other purchases. These ThankYou points transfer to a handful of travel partners. The card incurs no foreign transaction fees, and its $125 annual fee is waived for the first year.

For the ThankYou Preferred card, the current sign-up offer 20,000 ThankYou Points after a $1,500 spend within 3 months, with a 0% intro APR on Balance Transfers and Purchases for 12 months. The card earns 2 ThankYou Points per dollar spent on dining at restaurants and entertainment, and 1 point per dollar spent on all other purchases. The card comes with Chip technology and no annual fee.

The Citi Prestige card’s sign-up bonus is 30,000 ThankYou points after spending $2,000 in the first three months. The annual fee is $450, and the card’s benefits will undergo some considerable changes as of October 19, 2014. Among the coming changes are: a free 4th night at all properties (rather than select ones) in the World Elite Luxury Hotels and Resorts Portfolio, only when booked through Citi’s designated travel advisor, Carlson Wagonlit Travel;  an airline statement credit of $250; and Priority Pass membership. The card presently earns 2 ThankYou Points for each dollar spent on dining and 1 point per dollar for all other purchases. Starting in October, though, Prestige will introduce a new 3x bonus category for airlines, hotels, and travel agencies, and will expand the 2x category to include entertainment. 

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Diner’s Club International Card. This card is not accepting new applications, but for present cardholders, its primary coverage applies to physical damage and theft of the vehicle, reasonable loss of use charges, reasonable towing charges, and includes secondary personal effects insurance. Protection for covered damages applies to rental cars with a retail price of up to $100,000.

Diner’s Club doesn’t come with a sign-up bonus and charges a 3% foreign transaction fee, but has no annual fee and earns 1 Club Reward point for every $2 spent. These Club Reward points can be transferred to a wide variety of partners (including restaurants, airlines, and hotels), and the card offers 24/7 personal concierge service, global airport lounge access, and discounts on car rentals at Avis and Budget.

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Discover Escape Card. This card’s primary rental car insurance covers you for a rental period of up to 31 consecutive days, and excludes tax, gasoline, and airport fees from its definition of car rental charges. Covered vehicles include minivans and sport utility vehicles, but exclude off-road vehicles and cars that have a suggested retail price above $50,000. Coverage includes physical damage to and theft of the vehicle, reasonable towing charges, and any deductible or other eligible amounts not covered by other insurance. The insurance doesn’t cover personal injury, personal liability, damage to other vehicles or property, or any injury to any other party.

The current sign-up bonus on this card is 25,000 points, given to cardholders at a rate of 1,000 points a month for the first 25 months. (This equates to roughly $10 a month for two years, which is decent, if not particularly exciting.) You receive 2 miles for every $1 spent, as well as a o% APR for the first six months. The card’s annual fee is $60, it incurs no foreign transaction fees, and points can be redeemed for any flight, hotel stay or car rental without restrictions or blackout dates. However, be aware that Discover still receives limited acceptance within the US, and isn’t accepted at all in Germany, France, India and Chile.

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Fairmont Visa Signature. Primary coverage is offered for physical damage and theft of most rented vehicles, up to 15 consecutive days in your country of residence and 31 days outside your country of residence.

The current sign-up offer is two complimentary nights with breakfast for two after you make $3,000 in purchases within the first 3 months, as well as one complimentary night each anniversary year that you spend $12,000 with the card. You earn 5 Fairmont Rewards for every $1 on Fairmont stays, 2 for every $1 spent on airline tickets purchased directly with airlines, at car rental agencies, and on transit and commuting, and 1 for every $1 spent on all other purchases. The card incurs no foreign transaction fees, you’re given an automatic upgrade to Premier Status, and when you spend $7,500 on the card, you’re given a maximum of two stay credits per calendar year towards Platinum status.

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The Ritz-Carlton Rewards Visa Signature. Primary coverage offered by this card protects you up to the actual cash value of most rental cars, as well as damage due to collision or theft.

The current sign-up bonus on this card is 70,000 points after you spend $2,000 in the first three months. You receive 5 points per dollar on your Ritz-Carlton spend; 2 points per dollar on dining and car rental expenses, as well as airfare when purchased directly with the airline; 1 point per dollar on everything else. Points earned with the card can be redeemed at Ritz-carlton properties and for Marriott free nights. It incurs no foreign transaction fees, and comes with a $395 annual fee.

Additional benefits of this card are a $200 airline credit each year, $100 in hotel dining, spa or activities for each Ritz-Carlton stay of two nights or more, Priority Pass Select membership (free for additional cardholders), three upgrades to Ritz-Carlton Club level each year, concierge service, and instant Gold Elite Status, which is normally earned after 50 paid nights. Gold status is retained with $10,000 in annual spend each following year.

United MileagePlus Explorer and United MileagePlus Club. These are the only two Visa Signature cards to offer primary rental car insurance, and the insurance policy terms are the same as those offered by the Sapphire Preferred, with the exception of the expensive/exotic cars inclusions and the fact that United offers its primary coverage in all countries, even those normally excluded by other policies.

The current sign-up bonus on the Explorer card is 50,000 miles after spending $2,000 in 3 months, plus a $50 statement credit after your first purchase and 5,000 miles for adding an authorized user. You can earn another 10,000 miles if you spend $25,000 within a calendar year. In addition, you’ll earn 2 miles per dollar spent on tickets purchased from United and 1 mile per dollar spent on all other purchases. The $95 annual fee on this card is waived for the first year, and the card incurs no foreign transaction fees.

The Club card gives you full United Club membership (and Hyatt Gold Passport Platinum membership), as well as a $100 statement credit after your first purchase. It earns 2 miles per dollar on United purchases and 1.5 miles per dollar elsewhere. On United-operated flights you’ll get your first and second checked bags free, as well as priority check-in and boarding. This card comes with a $395 annual fee, but when you sign up for the card in a Chase branch, the first year is waived.

Cards from several issuers provide primary coverage, including Discover, Chase and Visa. (Image courtesy of Shutterstock)

Cards from several issuers provide primary car rental insurance coverage, including Discover, Chase and Visa. (Image courtesy of Shutterstock.)

Please note that USAA co-branded cards (e.g., American Express, Mastercard, etc.) also offer primary rental car insurance to their cardholders, but are only available to officers, enlisted personnel, or veterans of the US military and their eligible family members.

When you accept primary rental car insurance from a credit card, don’t assume that you’re covered for every possible auto-based mishap. Before you travel and/or rent a car, be sure to give your credit card’s customer service a call to determine exactly what is covered and what is not.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • mantan

    Even the cards that offer secondary coverage default to primary coverage outside of US. But there are other issues. I recently had a small accident on my Hertz rental in Cape Town. Another car rear ended my car. I rented it using Virgin Atlantic MasterCard. Hertz billed me a total of around $1900 which included some administrative fees and also about $245 of VAT.
    What I found out is that the credit cards do not cover VAT “unless required by the law”, whatever that means!
    So a lesson learned.
    Fortunately MasterCard did not hassle me at all and paid within 2 weeks of making the claim, so before my bill is due.

  • Ven

    If the Ink cards only cover your deductible, wouldn’t that be considered secondary insurance since your insurance company is paying the balance?

  • Giorgio Brusa

    what about the citi AA card?? I thought it does….

  • renue74

    I have the automatic $24.95 fee on my AMEX card every time I rent a car. I’ve never had to use the insurance, but I have heard bad things about this AMEX coverage…that they are difficult to work with and fight to not cover certain things.

    Is this true? I’ve always had “good” service from AMEX.

  • Victor Ko

    Which card should I use for rental cars? SPG Amex or Chase Sapphire Preferred?

  • Vijay

    Is Diners Club US accepting new applications? How do I apply for one?

  • Jay

    I damaged a car while parking in LA. Faxed the records from car company to Amex, follow-up call, and Amex took care of the $2500 bill. It was probably my 4th car rental under the $24.95 fee program, and I thought maybe it’s not worth it before the trip. ;) Just make sure you follow up on the faxes and emails (not everyone works like East Coast NY types, and take their time, especially out West).

  • Bruce

    Crashed a car in Iceland, pretty much totaled it. Rented with BA Chase card. They covered everything and even offered to pay any Foreign transactions fees.

  • Steve

    Ritz Carlton Visa card also offers primary coverage for car rentals

  • Steven

    Fairmont offers primary coverage as well.

  • Bill

    I have an Amex card, Chase Sapphire Preferred and the UnitedPlus Explorer card, out of the three, which card gives you the best coverage? I see that Amex changes a $25 fee, I’m wondering if it’s better to go with the other two, unless Amex has much better coverage.

  • Ryan M.

    Isn’t the CSP a Visa Signature? Mine is. If so, then the MileagePlus Explorer and Club cards are certainly not “the only two Visa Signature cards to offer primary rental car insurance.”

  • Harold Hoeg

    I thought I read something about Chase Sapphire’s primary coverage also extending to countries that are normally excluded, e.g. Italy, Ireland, etc. Is that correct?

  • Keenan

    CSP and MileagePlus Explorer now cover all countries including Israel, Ireland, and Jamaica (as of November of last year). You should make this clear as as it is a major benefit to those cards. I’m unsure if the Club is the same.

    If planning to rent in one of those countries, you can call Chase ahead of time and they will give you a letter proving coverage, if you want to have proof if they’re skeptical.

  • Keenan

    Yes :-)

  • Asian_Bro

    What about the Palladium card? I think mine offers primary coverage.

  • Brent

    The Chase Sapphire Preferred and the Chase Sapphire have identical benefits when it comes to travel protection and car rental coverage. The $95 fee on the Sapphire after you’ve hit the first year is pretty much just giving you the waived foreign transaction fee.

  • scott

    I didn’t know you had to pay extra to use Amex’s car rental insurance. I’ve frequently been renting using their card thinking that everything was covered. Does the Sapphire car insurance also work for authorized users renting on their own?

  • Maurizio

    Capital one venture is primary in europe?

  • Istvan Szabo

    Doesn’t the Citi AT&T Universal Business Card offer primary coverage? I think it is discontinued now, but it is the only reason I keep the card.

  • kcetgg

    Citi Thank You does not have primary coverage. The website says “provides coverage in excess of other insurance”

  • Marcos Prados

    I recently returned from a trip to the Costa Norte in the Dominican Republic and got in an accident with my rental car (no one was hurt, and we weren’t at fault). Thankfully, I put it on my AMEX green card and had no problems at all dealing with them. All charges were removed and it could not have been an easier process. Highly recommend!

  • Marcos Prados

    You don’t, necessarily. It’s secondary coverage if you have primary rental car coverage. However, if you don’t have it under your own insurance company then AMEX will be the primary. I, unfortunately, had to deal with this recently and was not charged any fees.

  • Marcos Prados

    I have had great experience. I totaled a rental car in the DR last month and the Santo Domingo Thrifty refused to deal with AMEX Assurance and continued to fraudulently charge my card. AMEX removed all the charges and it could not have been easier. I went into to it expecting to pay something and was pleasantly surprised.

  • philly

    USAA World MC only provides secondary coverage UNLESS you don’t have ins. or are out of the country & your current coverage doesn’t cover you.
    See: https://content.usaa.com/mcontent/static_assets/Media/MCWorldGuide.pdf?cacheid=2875115392_p

  • Vince

    Did you sign up for premium primary coverage? Or was this coverage that is already included in the card? I’m interested because I have an Amex Gold.

  • Marcos Prados

    No, since it was international it is provided without the charge. Simple as that!

  • Kent C

    You might want to doublecheck on the Ink cards. I spoke to their coverage department. I was told as of August 2013, I believe, they cover PERSONAL as primary now, you don’t have to be on a business trip. I mention this because you put it in bold.

  • Kappacino

    If a rewards card will cover me if I pay cash, will they still cover me if I used points to book the reservation?

  • Kyle

    Simply wrong about Citi’s auto rental coverage, which is secondary (read the full doc)

  • George T

    What if you live overseas and don’t have any primary insurance in The US? Can I generally assume that card insurance defaults to primary?

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