ente_09

Used my American Express card to pay the minor excess charges on a car rental paid for by my auto insurance while my car is undergoing damage repair .
I always waive those car-rental insurances, but later discovered that American Express will not cover any liability, unless the card is used to pay for the rental in full.

Even worse, I was sent the American Express liability policy and it turns out that they DO NOT cover any personal injury or damage to property issues as part of their coverage. .

All these years I was at risk . Do the auto rental agencies have insurance, just for personal liability /property damage?

brian22

Yeah, it's only CDW which a lot of people miss until they try and make a claim. I always pay the $10/day for liability when renting a car.

garykung

Your auto insurance covers the rental car as the insurance is paying for that. It has the same coverage as your policy.

So any credit card benefit would be moot.

LondonElite

What card and what market?

mia

To my knowledge, no USA-issued credit card includes Liability insurance.

If your American Express card is issued in the USA, it provides only Collision Damage Waiver. This means it covers damage to the rental car itself. It does not cover damage to any other car or property. It does not cover injury to any person. If you have personal auto insurance that policy provides your primary coverage against all of these risks, and the American Express benefit is secondary for CDW only.

This is clearly disclosed on the American Express website:

https://www.americanexpress.com/us/c...nce-terms.html

brian22

What happens if you have no car insurance? Does the secondary become primary?

mia

Yes, but only for damage to the rental car itself.

mtofell

Chase Sapphire Reserve says it's primary as far as damage to the car so you don't have to make a claim at all on your insurance. My understanding of most credit card car insurance is that it just pays the damage deductible and then your own insurance takes over. Liability you are on your own from the get go so if you have no insurance it's probably best to get theirs.

mia

Many cards do offer primary CDW, but these cards still do not include Liability coverage. American Express (USA) does not include primary CDW with any card, but they sell it as an extra cost option.

garykung

Then the whole situation and this thread would not exist.

OP mentioned:

Bottom line - OP's rental is an insurance rental.

Often1

People spend a lot of time worrying about whether they will have to cover a $500 deductible, but not a lot of time worrying about a $50,000 medical bill (or much, much, worse).

Before putting one's financial future on the line, it is only prudent to spend some time reviewing the coverage one has and what it means.

GUWonder

Yes, but there is the possibility -- uncommon as it would be -- of a car rental being an insurance rental for a person whose car insurance coverage has been terminated between the time of the incident giving rise to an insurance rental and the insurance rental itself. And it's possible than an insurance rental doesn't include liability coverage, whether or not it included CDW/LDW.

mia

The current rental is, but I think ente_09 is making the broader points that American Express's bundled CDW coverage is void unless the entire cost of the rental is paid with the card -and- there is no Liability coverage. This isn't new information, but it may be new to some readers.

swingaling

Note: I’m not a lawyer, and the following is not legal advice.

Rental cars are always insured, whether or not the renter has their own coverage or buys/declines the cover from the rental agency. Rental car companies, as registered owners of the vehicles (and as a matter of prudent risk management) are compelled to insure their fleets for liability coverage at a bare minimum. They usually insure for physical damage as well.

The type of coverage they purchase is called contingent auto liability insurance, and it protects the owner of the vehicle (the rental car co) in the event that the renter has no insurance or insufficient insurance to pay for the damages they cause to others.

That said, these types of policies are typically in secondary position and can be triggered only when the driver’s policy is insufficient. Further, contingent auto liability does NOT protect the interests of the driver at all. They have no duty to defend YOU in a suit; they only owe that duty to their insured, the rental car co. If found liable and uninsured, be prepared to hire a lawyer to protect your assets.

Rental car companies also carry policies for physical damage to and theft of their cars. This protects them from instances where a renter’s policy lapses, is insufficient, etc. And it also protects their fleet vehicles from things like hail storms, thefts, and accidents that occur when the vehicles are not rented out. Deductibles can be high ($2.5k+ per car), which is why they mitigate that risk by selling CDW and putting holds on your credit card.

Bottom line: the rental car company is always covered. But if you’re renting cars in the US, be certain you have a personal (or commercial) auto insurance policy that will cover you for your liability exposure because your credit card will NOT help.

Many don’t know this, but your personal auto policy will only extend to rented private passenger vehicles. So if you think it extends to a 16 passenger can or a U-Haul truck, think again.

Collierkr

renting a car without car insurance is foolish and subjecting yourself to potentially unlimited financial downside.