Insurance for rental cars via credit card: what do I have to consider?
Many credit cards have integrated additional services. One of the best known and most popular is car rental insurance. These offers can be particularly useful when traveling. However, there are some pitfalls that you should be aware of.
Insurance coverage must be booked consciously
The first pitfall awaits right at the start of many loan applications: Insurance coverage for rental cars is offered by the card provider or your bank, but it is not necessarily booked when you fill out the application for the plastic payment method. You usually have to check the box to book the policy. This increases your credit card fee.
This is what rental car insurance does via credit cards
Basically, the insurance cover for rental cars using your credit card is in three parts. You can either book each element individually, two out of three or all together:
- Liability insurance
- Fully comprehensive or partial comprehensive
- Glass and tire insurance
For frequent rental car users, all three insurance policies (ideally with the fully comprehensive variant) make sense. The glass and tire insurance should not be forgotten under any circumstances, since the appropriate protection is not part of most comprehensive insurance. Liability insurance with your credit card makes sense if you only take a rental car once a year.
If you rent a vehicle twice within twelve months, the combination of liability and partial coverage pays off for you on average. The corresponding offers from the rental stations are just so much more expensive.
Beware of other payment methods
One of the most central pitfalls lurks with third-party payment methods. You must pay by credit card to activate insurance coverage.
Alternatively, you can also rent the rental car with an electronic wallet such as Skrill or an online payment provider such as PayPal, but only as long as the card is connected to the respective payment method. If you do not pay for the rental car with a credit card, the insurance is suspended.
Beware of offers with a high deductible
Some credit card providers offer very tempting car rental insurance deals. For example, you can book extremely cheap comprehensive insurance policies.
The problem with this is that the deductible for such policies is extremely high. Not infrequently, for example, 1000 USD are estimated.
For comparison: If you insure your rental car through the rental company, the average deductible is 300 USD. In the event of damage, you would have to bear considerable additional costs.
Therefore, compare the insurance offers on the credit cards before deciding on a policy. Often the providers only advertise the policies with a high deductible, but in fact offer some other tariffs that are much cheaper for you in terms of price-performance ratio.
3 tips for car rental insurance using the credit card
Tip 1: The right credit card can lower your rent:
Many credit card providers cooperate very closely with car rental companies. Both discount programs put together: If you pay for the car with your card, the car rental will decrease in return. Alternatively, you can often extend the number of kilometers or add a driver at no extra charge.
Tip 2: You can put together a “car credit card” using bonus programs:
If you drive a lot, it is worthwhile for you not just to take out rental car insurance with your credit card. You can put together a kind of “car credit card” using additional bonus programs. For example, you have the option of receiving fuel discounts if you pay for the gasoline with the card.
Tip 3: Joint insurance for private and rental cars:
Some providers also offer you a common policy for your private vehicle and for rental cars. You take out a policy that is on average more expensive than a normal insurance for your private car. In combination with the protection for rental cars, it practically always pays off.