Rental Car Insurance Options

By the time you read this, I’ll be on vacation in Ireland.

I will rent a car and drive around the country. Naturally I don’t want to expose myself to losses resulting from a car accident while I drive a rental car in Ireland. I did some research in rental car insurance. I’m sharing this here with you.

Liability vs. Theft, Collision and Damages

On any auto insurance policy in the U.S., the coverage for liability and the coverage for the car are separate. If you have an older car, you may not have coverage for the car itself, but you should have coverage for liability, i.e. damage you cause to others.

This liability coverage may or may not follow you worldwide. You have to call your auto insurance company to find out. If you are covered, there is usually no deductible on liability coverage.

Theft is covered under comprehensive while damage caused by a collision is covered under collision. There are separate deductibles for comprehensive and collision coverage.

Your collision and comprehensive coverage from your auto policy also may not follow you worldwide. I called my insurance company. They told me I will be covered for liability worldwide but I won’t have collision or comprehensive coverage outside of U.S. and Canada.

Primary Rental Car Insurance

Your own auto insurance usually covers you when you rent a car, at least in the U.S. If you don’t want to use your own auto insurance (and subject yourself to premium increases in case you file a claim), you can buy primary rental car insurance.

I found two places that sell primary rental car insurance:

Company American Express [1] TravelGuard
Product Premium Car Rental Protection Car Rental Collision Insurance
Cost $18-25 per rental $9 per day + $3 service fee
Coverage Limit $75,000 – $100,000 $35,000
Deductible None $250
Max. Days 42 (30 for WA residents) 180
Covers Liability No No
Covers Theft and Damages Yes Yes
Covers Loss of Use Yes No
Excluded countries Australia, Ireland, Israel, Italy, Jamaica, and New Zealand Ireland, Jamaica
More Info 800-338-1670 800-826-4919

[1] Must enroll an American Express card

I don’t find primary rental car insurance that useful. I am exposed to the risk of having an auto accident every day when I drive my own car. That risk is covered by my own insurance. I don’t see why all of a sudden I want to pay extra to protect my own insurance only when I rent a car. If you want primary rental car insurance though, I think the American Express product is a better deal.

Secondary Rental Car Insurance

Many credit cards provide free rental car insurance. This insurance only covers theft, collision and damages. It does not cover liability. Usually it’s also secondary, which means your own auto insurance must pay first. In effect, the credit card’s rental car insurance only pays your deductible. If you don’t have collision or comprehensive coverage on your own auto insurance policy, then the credit card’s insurance becomes primary.

American Express Visa Signature MasterCard
Cost Free Free Free
Coverage Limit actual cash value actual cash value $50,000
Deductible None None None
Max. Days 30 15 in U.S.; 31 outside U.S. 15
Covers Liability No No No
Covers Theft and Damages Yes Yes Yes
Covers Loss of Use Yes Yes Yes
Excluded countries Australia, Ireland, Israel, Italy, Jamaica, and New Zealand Ireland, Northern Ireland, Israel, Jamaica Australia, Ireland, Israel, Italy, Jamaica, and New Zealand
More Info 800-338-1670 800-397-9010 800-622-7747

Ireland

If you are still with me, you notice Ireland is one of the excluded countries in all these insurance options, and I happen to be going to Ireland! I don’t know what the deal is with Ireland. Theoretically AmEx, Visa, and MasterCard cover me if I rent a car in Iraq but they won’t cover me in Ireland. Isn’t that crazy?

The rental car companies in Ireland offer Collision Damage Waiver (CDW) for about 15 Euros per day, and it comes with a deductible of 1,500 Euros or so. 1 Euro is worth about $1.50 now. If I pay another 10 Euros per day for a so-called “Super CDW,” they will lower the deductible to 100 Euros. $25 Euros per day for insurance is more than the cost for renting the car itself!

Fortunately I found a way to avoid being fleeced. The rental car insurance offered by a regular (“Platinum”) MasterCard excludes Ireland. The insurance from a World MasterCard (except those issued by Citibank) includes Ireland. Needless to say I upgraded my MasterCard to a World MasterCard. Whew!

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Comments

  1. AM says

    A reason to pay for rental car insurance is to avoid the hassle and be able to just walk away. Otherwise it’s your responsibility to make the rental company whole and deal with insurance. A rental company might insist that you leave a large deposit because they are afraid you won’t pay, and then you need to worry about extracting the repair estimates/bills from them so that you can submit them to your insurance. This may be difficult when the rental was half-way around the world and you don’t speak their language, etc.

    I’d be interested in reading about practical experiences with submitting claims for a rental car damages, especially if they occurred abroad. Maybe it’s not that bad.

  2. says

    Wow what a coincidence.

    I will be leaving for Ireland this Wednesday with a couple of friends. What cities are you going to?

    I just learned how to drive manual this weekend. Hopefully driving in the cities won’t be a problem.

    Enjoy your trip!

  3. wl says

    If one has no personal auto insurance but does have rental car insurance through a credit card, what do you recommend for liability insurance? Skip it, buy from the rental car agency, or elsewhere?

  4. right side of the river says

    as a follow-up to wl’s question: are you required to have liability coverage when you rent a car? i’ve rented off and on within the US and have always been able to get by just with the coverage from my credit card, but this last time I was told I couldn’t rent without proof of liability coverage, which I then had to purchase from the rental car company.

  5. Sharon says

    Before finding this article, I discovered on my own that a regular Mastercard doesn’t cover collision damage in Ireland. So I applied for a Travelocity WORLD mastercard for exactly this reason. However, without any notice or explanation, I was issued a Platinum card instead. I’m very annoyed with both Travelocity AND Mastercard at this moment and waiting to hear if they will fix it. I have good credit and simply want the card I requested when I applied. If you apply for the WORLD card, make sure that’s what you get before you put the rental charges on it.

  6. TIE says

    right side of the river,

    Did you ask the rental car agent to call the credit card company to verify your coverage? That should have settled it. If that isn’t good enough then I would be strongly tempted to find another rental car company.

  7. right side of the river says

    TIE, you know, I didn’t really know what to do in that situation given that this was the first time someone had told me this, and the reservation had already been paid for in advance online. Budget car rental at the Las Vegas airport, in case you wanted to know. and yeah, not doing business with them again!

  8. says

    Checking in from Ireland. The World MasterCard worked. The guy at the rental car counter asked me if I had a World MasterCard. When I pointed out the word World on my card, he just handed me a piece of paper for me to sign, which said I chose to have the credit card cover me.

    @JC – The roads in Ireland are very bad: narrow and winding. Driving on the left side of the road makes it worse (driver sitting on the right side of the car). If you only learned how to drive a stick shift, good luck. I paid extra and rented an automatic. I still find it a challenging chore.

    @wl and @right side of the river – You are legally required to have liability insurance when you drive, although nobody ever asked me for proof of coverage when I rented a car. If you don’t have auto insurance because you don’t have a car, you are supposed to buy liability insurance. None of the options I listed in this post provide liability coverage. They only cover the car, not the bodily injury or property damage you cause to others. I haven’t done any research for liability coverage.

  9. Keith says

    Right side of the river –
    My understanding is that each state makes every rental company carry a basic amount of liability insurance. Which makes sense because the last thing a state wants is a company giving cars out to people without some kind of liability insurance. Of course, rental companies don’t advertise this very much.

    Also, if you have renters or home owners insurance I would check with them. You should have a broad liability coverage there that would cover you as well.

  10. Craig says

    In Nevada we will charge for for lost rental time if your vehicle is in need of repair. We will charge you full rental until it is repaired, which could be up to 28 days. Your insurance DOES NOT COVER THIS CHARGE! Neither does your CC protection. Your insurgence carrier and CC card company will not disclose these facts readily. Your deductible also applies and they will not cover that. There are other exclusions also….. it’s the insurance providers way of getting out of paying a claim. Also a rental LDW and CDW will not cover if you are drunk or under drugs….. in reality GET REAL, don’t think you’re too good and never at fault.

  11. Bob says

    American Express does cover loss of use if the rental company will produce a “fleet utilization log” showing that someone wanted to rent the car while it was being repaired but could not. The rental company may choose not to provide this.

    Also, the best reason to buy primary car rental insurance is if you are renting a particularly expensive or “exotic” car because your regular credit card CDW may not cover it. For example the regular Amex insurance will only pay if the car you rent has an MSRP less than 50k USD.

  12. says

    @Bob – The PDF I linked in the post for American Express stated in the middle of p. 4 that the policy will not cover “loss of use fees imposed by the Rental Company.” It could be outdated. Do you have a link to the policy that shows it does cover loss of use?

  13. JSM says

    What car rental company are you renting from? Did you pick up the car at Dublin Airport or elsewhere? And what is the daily rate (minus the car rental insurance, of course :-) We’re traveling to Ireland next month, and it would be great to have this info.
    Hope you’re enjoying your trip!

  14. David says

    I too am planning an Ireland trip…leaving mid-August. I have found getting a World MasterCard to be a frustrating runaround in its’ own right. I am facing US$345 just to have CDW & SDW for 8 days. Outrageous. I wish someone could convince me there is a better way. I am not even sure that the World MasterCard would really cover me.

  15. says

    @David and @vickie – I got my World MasterCard through Chase. I already had a regular MasterCard with them before. I asked Chase to upgrade my card to a World MasterCard. They gave me a Chase Freedom card, which is also a World MasterCard. It was done in about a week.

    Europcar took my World MasterCard CDW coverage without fuss. The guy at the counter actually asked me if I had a World MasterCard.

  16. Micki says

    Does anyone know what car insurance companies provide coverage for rental cars internationally – at least from the liability standpoint? I am in a tough situation. I am going to New Zealand in 2 weeks. My Visa card offers me collision and theft primary coverage (since my car insurance company does not for international rentals). However I have no liability coverage. One might think, then just get the SLI (suplimental Liability Insurance) from the rental car company, but for some reason in New Zealand, Avis does not offer that. I have no idea how to get liability coverage, and it is way to risky to drive without it. I would be willing to change my car insurance company and/or buy liability insurance seperately, but I can’t seem to find a company that will offer it when I am traveling in foreign countries. Any thoughts?

  17. says

    Micki – Do you have a personal umbrella policy? My umbrella policy covers my liability worldwide, including liability that arises from auto accidents. It’s a good idea to have one for other reasons too. If you don’t have one, ask your auto insurance company about it.

  18. Barbara Kilroy says

    We’re going to Ireland this summer and will need 3 rental cars. I’d hoped to upgrade to a World Master Card to get my CDW coverage but when I looked up the 2008 coverage details it said that the card “may” not cover in Ireland and recommended that we check with the rental car company. HELP! Rental car CDW coverage for 30 days for 3 cars will cost a fortune. We can front the repaid cost if necessary, but want to make sure that we’ll get reimbursed.

  19. says

    Barbara – Call 1-800-MCASSIST to confirm your coverage. If you picked out a rental car company in Ireland, you can call them as well.

  20. ann says

    World MasterCard rental car insurance is accepted only in Northern Ireland, so if you pick up your card there you are ok. I checked with MasterCard yesterday and got that information. Is it necessary to purchase excess coverage if offered if the rental fee includes CDW?

  21. Cam says

    I have been going to Ireland nearly yearly (and sometimes twice a year) for over 23 years and have seen so many changes in credit card coverages and even scams by the Irish rental companies. I am going again in 12 days and checked all my World Mastercards again and they all cover the Rep. of Ireland. Some of them will say that they don’t on websites (www.benefitinformationcenter.com) but press to speak to an expert, or call 800-622-7747 and give them all your card numbers to have each one checked out. Learning from my experiences and family and friends, I have not heard of a World card that does not cover you on car rental collision any-where in the world. I saw the post that says Citibank may not- so check that out. Bank of America seems to be the easier and quickest place to get a World card and has several to choose from. Also, ask Mastercard to email you a letter stating that your credit card offers collision protection. They will gladly do it in about a day. They know that it is difficult to rent cars in Ireland without the letter.
    Drive safely! We need to get this insurance lowered and more credit cards covering it.

  22. Kristin Lambert says

    I will also be going to Ireland and will rent a car in September. First off, thank you so much for this posting! I had already been told by the issuing bank that my credit card did not include CDW coverage in Ireland, but after reading your forum notes I realized that since it is a World Mastercard, they might have been wrong. Thank heaven I called again to the Master Rentals Insurance Claims Department and got the correct information (1-877-382-3933 – press #3)

    I learned that although my World Master Card (Lufthansa Miles & More which also accumulates frequent flyer miles) does cover CDW all over Ireland, the letter of coverage is only good for 60 days, so you must call to ask for it and have it dated within 60 days of your rental of the car.

  23. Kevin Neal says

    I have a CitiBank World MasterCard. The “Summary of Additional Program Information” from Sep 1, 2010 states the following for the MasterRental Insurance:

    Where you are covered:
    In general, coverage applies worldwide, but there are exceptions:
    -You may be unable to receive benefits in Australia, Ireland, Israel, Italy, Jamaica, and New Zealand. Please contact your vehicle rental agency before you travel.

    I called the number for clarification, during which the automated message summarized the same information to me before I could reach a human. That message only included Australia, New Zealand, and (I think) Italy. When I reached the operator, she clarified that the World MasterCard *does* cover damage/theft/etc, but that some car rental companies require purchase of insurance to rent the car.

    Hope this helps. Safe travels to all!

  24. Warren Vin says

    Actually, the article is NOT correct – It states that the PREMIUM AMEX policy does not cover loss of use. Item 2 under “Benefits” clearly lists “Loss of Use”. Loss of Use IS COVERED.

  25. Philip Litteer says

    Get the extra damage waiver if you are unsure of your coverage! I was recently in Ireland and was involved in an accident that demolished my rented car. The car was virtually new showing just over 2000 kilometers on the odometer at the time. It smelled and drove like a car just out of the showroom. The accident left it totalled.
    Thank God there were no injuries in the accident (it was close). I had a replacement car from the rental agency the same afternoon (which I drove with some fear), and there was no hassel whatsoever. No out of pocket money to me, insurance took care of everything. Do not try to save a few hundred dollars if it might cost you several thousands in out of pocket liability. Get all the insurance you can !

  26. Murphy says

    I am going to Ireland in 2 months and have a World Mastercard. Thank you for all the information about coverage and CDW. I will def check my coverage within the 60 days.

    My question is what is a decent car rental company to use? I read on some other forums that some companies (when you decline their CDW) will not just put a HOLD on your cc for a certain amount, they will actual charge your cc. And after the car is returned, you will get your refund back (minus fees). Is this true?

  27. says

    @Murphy – I rented from Europcar back in 2009. I don’t remember whether they charged up front or not. If they did, they refunded in full, no fees.

  28. Barry says

    We intend to rent a car in Ireland next month. It is hard to get a clear idea exactly what they are going to charge. Taking your advise I called Visa and they said they did not cover Ireland. I called Master Card and Citi and was told that my Citi World Master Card would cover it even in Ireland and they would send me a letter to prove it. Maybe the policy has changed at Citi.

  29. Richard says

    I live in the Continental US and have liability only. I rent my car for business which is not covered by my personal insurance. I am looking to buy auto rental insurance separate from the rental cars insurance at the counter and to keep it separate from my personal insurance even if I were able to go that route. If I had a claim it would not count against me if I keep it separate.

    Does anyone know where I can buy this kind of insurance that includes collision. My visa card would only cover damage to the rental vehicle.

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