Mr. Vker

I personally see nothing wrong with this. Its just like a hotel reservation. They use one card to hold it, they swipe one at check in and you can pay with another at check out.

Especially if you are like Hertz Gold where the card on file is pre-authroized for the rental. You can present a different card at drop off.

mia

Switching to another card at the conclusion of the rental to avoid paying the premium is called self-selection, and it invalidates the actuarial basis of the insurance. Insurance only works if the insurer collects the premium from a large number of people who do not have a claim to accumulate the funds to pay those who do. Evading the premium after seeing that you will not have a claim is, in my opinion, unambigously unethical.

However, I understand that the OP's question ackowledges this perspective, and the question is whether, as a practical matter, American Express can detect this behavior (I think they can), and whether there are conequences (I do not know).

Ilove2fly

Mia is right. What OP proposes to do is highly unethecal.

At the start of rental, a hold is placed on the card for the amount of rental plus potential fuel charges. Amex knows the moment a car has been rented with Amex. If I were Amex, the insurance fee will be added at that moment. But I am not, so it will be interesting to see what actually happens.

brosnan6

I don't see how Amex could do anything if they found out. What can they do, sue you for not finishing the transaction on your card? As a consumer you have the ability to pay for your service any way the service provider allows.

I don't see this as unethical, rather you are just taking advantage of a loophole in the system. If Amex really cared, they would figure out a better way to charge the premiums for this additional insurance.

Just my two cents worth...

KyRoamer

This is not a loophole, it is a theft of services. Once you have finished the rental you have had the benefit of the insurance. You owe the money.

If I use one card to hold a hotel or car reservation and then change before using the room or car, that does not seem dishonest or unethical. The other at the very least is unethical.

slawecki

i would read all the fine print in the card and the insurance.

AMEX has been around the block before. I'll bet anything there is a right to card cancellation clause for cause in there. they cancel your card, your credit score may come up negative.

JohnnyP

Or they may have the right to not cover you if you ever get in an accident based on past "denial" of coverage...?

guv1976

Wirelessly posted (BlackBerry8703e/4.1.0 Profile/MIDP-2.0 Configuration/CLDC-1.1 VendorID/104)

I really don't understand all the fuss about this "Premium" Amex car insurance. It does not seem so much better than the standard coverage you get from Amex (and Visa and MasterCard) for free. The Premium insurance does not include third-party liability coverage, so if you run someone over, you (or your personal insurance, if you have any) will still be responsible.

I suppose one advantage is that the Premium coverage is primary, rather than secondary, but I'm not sure that that's worth paying $25/rental for. (It certainly isn't for me, since I don't own a car, and the free credit-card LDW coverage is therefore primary in my case.)

And if you rent frequently and want primary LDW, wouldn't it be more cost effective to pay the annual fee for a Diners Club card, which automatically provides primary LDW?

HookemHorns

In my mind, the primary coverage is decent benefit, and for certain circumstances, I think it is worth the money. For most rentals, I just use my Merrill+ and count on my own car insurance policy with the Merrill benefits as secondary.

However, in places where I know the risk of an accident is a bit higher (STT or FAO to name a few), I use the AmEx. These instances are usually once or twice per year, so for my particular situation, I think this is a better route than getting a DC.

guv1976

Fair enough, but unless your personal car insurance covers you outside of the U.S. (many policies don't), then your Merrill LDW benefits would likely become primary for a rental in Portugal. Most of the credit cards that offer LDW coverage say that their coverage is secondary to any other collectible insurance that the cardholder has. If your personal car insurance does not apply in Portugal, it is not collectible, and your credit card LDW coverage would be primary coverage for that particular rental.

stargazer555

Another thing to keep in mind is that some car rental companies sometimes claim that they "discovered" damage (usually on wheels or undercarriage) days after the car is returned. Premium car rental insurance definitely comes handy in those situations.

Ilove2fly

When traveling for business, I use the premium rental insurance because my company does not have additional insurance to cover car rentals but will pay for the LDW insurance. I figure I am saving my company money by using Amex premium insurance. Again, there are less than 6 occurance a year. $20 per rental is really reasonable especially if the duration is 4 days or longer.

Besides, I want an Amex card because American Express has office/store front arround the world. I really don't want to carrry an additional card such as DC.

Doppy

What AmEx could do is drop you from the premium insurance plan or drop you as a cardholder altogether. I think it's somewhat unlikely that they're on the lookout for this type of behavior, so I don't think it's too likely. I also don't think they'd try to sue.

However, if someone did try to file a big claim and AmEx looked for or became aware of this type of behavior, they might try to use it as a basis to avoid payment, and I wouldn't be surprised if this behavior were a violation of the terms and conditions of the program, making their argument even easier.

HookemHorns

Absolutely correct - it was an oversight not to mention that my primary insurance does have limited overseas coverage...the $19 per rental for AmEx seems cheap to be able to turf the problem off to the credit card company and not be in the middle of it. I could be mistaken, and hopefully I'll never have to find out!

steve4

I'm enrolled in this program, but I'm not sure exactly how it works. If you get into an accident with the rental car, do you call AMEX and let them handle the police report/paperwork before calling the rental company ? Or is it the other way around ? I remember renting a car once and after declining the CDW the rep asked me the name of my insurance company. I told him that I had rental coverage through AMEX, but he still needed to know my insurance company. Just wondering how the primary coverage works while leaving your insurance company out of the loop.