There are dozens of ways to insure yourself when driving a rental car and one of the most popular ways is through your credit card company. It seems cheap up front, but there is a lot you need to know before using it. While you might save a few bucks up front – in the event something does happen – you’ll wish you had used your rental car agencies’ coverage.
Here are some of the pitfalls of credit card car insurance.
Be wary of credit card coverage
Credit cards offer a variety of benefits, and car rental insurance is certainly one of them. But credit card car rental insurance isn’t always the best. For one, it’s almost never universal, so you can’t easily use it from company to company. The other thing to know is that credit card car rental insurance might cover certain cars, but not others.
The big thing to remember is if you’re on a long trip where you’ll need your car for a number of days, maybe even weeks. Credit Card Car insurance will only insure you up to a certain amount of dates, which if you don’t know, could end up costing you the full amount at the end of the trip if something happened.
In most cases, if you want to use your credit card to insure your rental, you have to put the full amount of the rental onto your credit card. If someone has limited or poor credit, this keeps you out of the game and if you don’t put the full amount on your card, then you’re exposed.
Again, if you’ve got a big line and are ok – then that’s one thing, but just remember where the bill’s going at the end of the day.
Credit card coverages usually offer secondary coverage
Be mindful of this. If you’re in an accident, then you’re going to have to go through other avenues for compensation if you need to pay for your damages. There’s a charge to your personal auto insurance, and then once that’s done – you try to claim the rest through your credit card company. It’s not the easiest route to go.
Some companies do offer full coverage, but it depends on the cardholder and your own personal account to know what you are protected from.
Paying up front
Credit Card car insurance usually assigns itself as secondary insurance. And your auto insurance is almost always going to make you pay out of pocket – at first – for your damages. Any complications and you’re looking at harm to your credit score. Be wary.