Locking this thread because we are not going anywhere productive, and this forum does not condone violating rental agreements or sidestepping the rules in any way. OP isn't even participating and this has turned into an argument about whether it's worth it to break the rules or not.
If a person wants to use a code that they may or may not be entitled to use, that is a personal decision to make. Each person is responsible for knowing the limits and exclusions of their own insurance coverage, whether it be from a credit card, the agency, auto insurance, or something else. Similarly, each person can make their own personal risk assessment about whether the dollar savings are worth the (admittedly, worst-case) potential for being left exposed for all of the costs associated with an accident.
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bocastephen I can tell you that no insurance company will cover a loss where fraud is involved, and define it however you want, but if you're using a code to get a better price for the rental than a publicly available rate, or one that gives you benefits negotiated by a company or organization meant for that group's constituents, it's fraud. This isn't about the LDW coverage issue, it's about coverage for the overall incident. Prohibited use also includes committing a fraud on the owner of the vehicle during the course of the rental. But hey, like I said above, it's a personal decision to make, and as a lawyer with many years of insurance practice behind me, I know how I approach these situations.