Rental car insurance: No-brainer “no”?

  • Car rental insurance coverage is generally a poor buy
  • Unless: you’re out of the US, don’t have regular car insurance, or a few other cases
  • A service from Amex is interesting: affordable and comprehensive

When renting cars, it’s a given for savers to turn down insurance offered by the rental company. Too expensive, too limited, a hassle, a ripoff.

Don’t be this guy on vacation

Besides, any credit card junkie knows that many popular cards (like this one) offer what’s known as “secondary” coverage for the vehicle when you rent using that card.

The concept is that your personal auto insurance almost certainly extends your “primary” coverage to rentals, and your credit card backs that up with insurance to pick up the slack NOT reimbursed by your policy. That slack is primarily your deductible, but conceptually could be more. Check your auto policy for coverage details on rentals.

And some credit cards offer primary coverage, as well, though you’ll pay for the privilege in annual fees.

So who needs coverage offered by Hertz, Avis, and the rest? Especially at upwards of $20+ per day? Not you. Right?

Probably. But there are a few issues.

  • One: car rental outside the US often isn’t covered by your standard policy.
  • Another is that your credit card “secondary” coverage only covers damage to the vehicle, which – don’t get me wrong – can be expensive. But the bigger risk is your liability if you damage property or cause injury to another driver. That’s all on your primary insurance.
  • If you don’t have auto insurance at all, that changes the equation as well.
  • And last: it’s a massive headache to work through two insurance cycles to deal with these problems.

All that noted, I still avoid the upsell of insurance at the rental counter. But I’m reconsidering, due to a service that I just discovered.

I’m talking about Amex Premium Car Rental Protection, which appears to be available on most (if not all) American Express cards as a opt-in additional charge – again, when you use your Amex to rent.

In brief, for a low fixed fee per rental (not per day), they offer primary coverage for theft and damage. For any longer term rental – say, over 4 days – it seems like a pretty good investment. It runs ~$15-25 all in. And it covers most overseas rentals, with a few exceptions.

This post from Autoslash has full detail, and a few other important topics related to car rental insurance. As usual, Autoslash is a must for rental car users; check it out and use it for every rental. They regularly put out interesting, useful tidbits like this on their blog, too.

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