Released: January 29, 2019

Help Desk FAQ

Do I need separate rental car insurance?

The insurance that car rental companies sell can be very expensive—sometimes more per day than the cost of the rental itself! If you have a credit card that offers "collision damage waiver" (CDW) coverage, it can save you a lot by covering the loss if your rental vehicle is damaged or stolen (so that you don't have to purchase the rental car company's insurance). If you also have personal auto insurance that would cover the rental car damage or theft, then the credit card benefit would reimburse your deductible. To take advantage of the card’s benefit, you must decline the car rental company’s collision damage waiver.

However, it is important to understand that while credit card CDW protection may cover you if your rental car is damaged or stolen, it does not cover you for actions that harm other people or cause damage to other vehicles or property. If you are involved in an accident that injures other people or damages another vehicle, your personal auto insurance coverage would cover your personal liability, up to the limits of your coverage.

Benefits and restrictions vary among card issuers, and may not be applicable to auto rentals related to business travel. Also, since early 2018, card issuers have been discontinuing some of the many benefits they used to offer, including CDW coverage. So, even if your card used to provide CDW coverage, it may not now. Before you rent a vehicle, contact your credit card issuer regarding its current policies. Also ask your auto insurance carrier if your policy provides liability coverage while you are driving a rental car. Consider adding this coverage if your policy does not include it.

International rentals

Your personal auto policy probably does not provide liability coverage for you when you rent a car overseas. It is crucial to know what coverage you need and to get it before you drive in a foreign country. For instance, many U.S. car rental firms terminate ordinary coverage if you cross the border into Mexico from the U.S. To drive in Mexico, you need civil liability insurance to provide coverage in case you cause injury or damage to property while driving.

In Canada, you must present a certificate of liability insurance from your U.S. carrier. If you don't have this document at the counter, you will not be allowed to rent a car until you pay for liability coverage.

Some countries also require you to provide an international driver's license, which you can get through the Automobile Association of America (AAA).