OT More about credit card rental car insurance CDW

[micky]

In another thread, maybe OT Credit Card Charging, someone made the reasonable announcement that there was no way a credit card would insure someone for the cost of a whole car based on the measly fee they make when the cardholder charges the rental. Makes sense, but I'm not sure it's true. American Express seems to have 50, count 'em, 50 different credit cards, and to learn the terms for auto rental insurance, you have to click on the picture of your card, one of 50. Maybe some of the 50 use the same terms but I haven't' compared them.

This is for the card that's connected to a Morgan Stanley brokerage account. I don't know for sure if they checked how much money the account had and they gave me 3000 credit, which iiuc is not very low and not very high, in the scheme of things. (using a logarithmic scale, of course, where the relationship between 300 and 3000 is the same as between 3000 and 30,000)

I would guess that the terms here are found in 30, 40, maybe all 50 of the other cards, and I'm pretty sure that once the card is issued, it's the payment record that matters, and not how much is in the MorganStanley account.

Length of Coverage Car Rental Loss and Damage Insurance covers eligible Rental Autos when rented under a written rental agreement from a Rental Company for no more than 30 consecutive days. Note: In no event shall coverage be provided when the Cardmember rents a Rental Auto beyond 30 consecutive days from the same Rental Company, regardless of whether the original agreement is extended, or a new written agreement is entered into, or a new vehicle is rented. Additionally, no coverage will be provided when the Primary Renter rents a Rental Auto for more than 30 consecutive days out of a 45 day period within the same geographic market/location (75 mile radius).

===>So they covered that pretty thoroughly. If renting for more than

30 days, it would be a lot of trouble to change car rental companies to save the Collision Damage Waiver charge, but what is it, about $4/day?, So that's $120 per month, and twice that for 2 months. But they won't let you change rental companies, and they'll know if you do, because you're not covered if you don't charge the rental on this one card. Maybe you could use a different kind of card for each rental, and though the words above seem to prohibit a claim based on that too, I don't know how much they share information. OTOH, by renting for more than 30 days, one might save money on the rental. I don't know off-hand how that amount compares to $4/day.

What is Covered Car Rental Loss and Damage Insurance reimburses a Cardmember for payments for damage to or theft of a Rental Auto that the Cardmember is required to make, up to the lesser of: 1) the actual cost to repair the Rental Auto, 2) the wholesale Book value minus salvage and depreciation costs, or 3) the purchase invoice price of the Rental Auto minus salvage and depreciation costs. The coverage also reimburses the Cardmember for reasonable charges (those charges incurred at the closest facility that are usual and customary in the vicinity in which the loss or disablement took place) imposed by the Rental Company, such as towing or storage and Loss of Use2

===> This makes total sense, except I'm not positive what the "depreciation" would be in number 2, but given how reasonable the rest of it, I'm pretty sure that is too. Anyhow, it appears to pay for the entire car.

Also says "What Excess Coverage Means. Car Rental Loss and Damage Insurance is an excess insurance plan. This means that this excess coverage will reimburse the Cardmember only for losses/expenses not covered by plans, such as a partial collision damage waiver, any personal auto insurance, employer?s auto insurance or reimbursement plan or other sources of insurance. When these other plans apply, a Cardmember must first seek payment or reimbursement and receive a determination based on the stated terms of such other Plans, that any such Plans do not provide coverage before this excess coverage will reimburse the Cardmember. "

===> This seems totally clear that it is not required to have collision insurance on one's own car ("personal auto insurance") etc, and if you don't the credit card company has to pay the whole thing, not just the deductible.

So the reasonable statement I referred to appears not to be true, and I'm surprised myself.

(I've never had collision insurance, except 46 years ago when my mother bought it without asking me. And that was more trouble than it was worth. I lent the car to someone who wrecked it within an hour, and I thought State Farm cheated me on what they paid (400 plus I kept the car), and otoh, they were so annoyed at me that later, when I got back from Costa Rica, they lied to my mother and said I had to be present and sign something to reinsure me. Later the agent admitted that wasn't true. It left me in San Antonio getting my car out of storage but with no insurance. And all the insurance agents insissted that I have a Texas address to get insurance, even though I was sleeping in my car and leaving the state as soon as I got insurance! I'll never do business with State Fram.

It also excludes 6 countries, though what they have in common I can't figure.

[hubops]

< snips >

The rental cars are insured by the rental company. The premium credit cards will cover the deductible and other misc extras as stated in the cardholder agreeement. Your own car insurance will usually cover a rental - up to the coverage and deductibles on your policy.. John T.

[Kurt V. Ullman]

The problem at both ends is that often neither of them cover the charges for the days the car can't be used (don't remember the name of that right now). There are some areas that are restricting the company's ability to do that.

[trader_4]

And like any insurance company would, they will go after whoever caused the damage to collect. This is like you having insurance on your car. It covers payment to make YOU whole and then if there is another party responsible, eg the guy who hit your car, they will then go after that person and/or their insurance company to collect. If you take out a rental car without collision insurance, of course the rental company is coming after you. Otherwise, who would be paying $10 a day when they rent a car to protect against that? So, having a credit card company who will provide the coverage for free, is a very good idea.

No, per plain English of the contract Micky provided, they cover the whole thing.

[trader_4]

It's loss of use that you're talking about. The defense against that which usually works is to tell the rental company to produce their logs that show all similar cars were in use at the time. If they can't do that, they have no loss of use case.

[Ed Pawlowski]

IIRC I had to pay, by law, in Italy and this mentions it too. Mikey may do better leasing for a longer trip.

If you?re renting in either Ireland or Italy you?ll have little choice but to buy the company?s CDW. If you need a car for at least three weeks, you?re probably better off leasing, which includes zero-deductible collision and theft insurance (and is tax-free to boot).

[hubops]

as per the original post :

Car Rental Loss and Damage Insurance is an excess insurance plan. This means that this excess coverage will reimburse the Cardmember only for losses/expenses not covered by plans, such as a partial collision damage waiver, any personal auto insurance, employer?s auto insurance or reimbursement plan or other sources of insurance.

ie : the credit card coverage pays the deductible.

John T.

[micky]

That's true when the excess = the deductible. But when the renter refuses the Collision Damage Waiver, as the credit card usually insists you do for them to cover anything, and he has no collision insurance of his own or any other applicable insurance, then for this credit card company and this contract, the excess is the entire loss, other than what the contract excludes**.

**Such as loss of use, injury to other people, etc. though I think there is no way to refuse that rental company's insurance for that.

[micky]

Yeah, those are two of the six countries listed. Another page implied that all of Mastercard and Visa excluded those countries, I'm guessing because of something about contract or insurance law tthere.

The choice of leasing seemed to require it be by a corporation, but I'll check again.

Because of the 30 day maximum, I've been looking around and not every card has any rental insurance, though in some cases it's hard to know for sure until one signs up. For some, you can google the name of the card and a keyword and find details, but maybe not even then since different cards from the same company can be different. But with other companies, I haven't found even one page with details.

Like the Amazon credit card that they are alway pushing. $50, one shot, but no percentage back after that. Yet I found a page that said it had rental insurance, but no details.

Anyone have an opinion about the Amazon credit card that they push?

I looked into rates but I think they gave me a total and I still don't know how much is for CDW. One page unrelated to these rental companies claimed it could be $45/day, but surely that's for a Rolls. I remember it being 4 years ago and Trader said $10. $10/day for 77 days is $770

I've even considered buying an old car and selling it.. well, trying to get my old friend to sell it after I left, but she showed no interest in that! Maybe if I let her keep the money. A guy and his brother that I barely knew, though their sister and parents had been very nice to me in Belgium, stayed at my apartment in NYC and they bought a car, drove around the country, then sold it before they went home (and stayed one more night before they flew home).. But I think paperwork here is simple compared to some other places.

[micky]

This was already written. Maybe it's overkill now, and if so, please forgive me.

I suppose, but they still want you to pay when you dent them. Their insurance company** is the secondary insurer and the renter is the primary insurer. **Some companies are self-insurers, at least for the damage to the car.

As I said, I don't have collision insurance or theft insurance***, but afaict, the credit card I have will cover the entire loss, not just a deductible, for someone who has no other insurance. Except that in this case I'm renting for more than 30 days.

A general web page I came across says "similar requirements will be found on all of these kinds of policies, along with other specific guidelines and rules. The maximum reimbursement for a totaled rental car is usually about $25,000 and won?t normally extend to other kinds of coverage such as personal injury, liability, or damage to other vehicles or property. While the insurance may apply to vehicles rented anywhere in the world, it?s a good idea to check with your credit card company. "

So he says that the payment can be as much as 25K!!

***At home, if my car is ruined or stolen, I buy another one. I buy cars that are not late model so that I can afford to do that. But the rental cars are almost always late model.

[hubops]

You say that the credit card company " insists " that you decline the rental company's collision damage waiver ... even though they clearly state - in your original post - quoted above - that theirs is an "excess insurance plan " .. geeesh. John T.

[trader_4]

On Saturday, December 31, 2016 at 11:05:50 AM UTC-5, [e-mail] w rote:

That is not what it says. It says the credit card company will cover you for whatever is not covered by other insurance. Yes, if you happen to have other insurance, that covers you and leaves you with a deductible when you wreck the rental car, then the CC company will only pay the deductible. Examples of that other insurance might be your personal auto policy. But if you rent a car, do not pay extra for their insurance and don't have coverage under your auto policy or CC and wreck it, you are on the hook for the cost of the damage up to the value of the car. The rental companies are NOT providing everyone with free insurances, leaving you only responsible for a small deductible. Have you even rented a car? Why do you think they are offering insurance at $10 a day to cover the car? If all you were responsible for was a $500 deductible, no one would ever buy it. People buy it because you are on the hook for the WHOLE thing.

Your big mistake here is that you think rentals include collision coverage, theft coverage, etc with you paying only a deductible, THAT is simply wrong, at least from every rental car company I've ever dealt with and I've dealt with a lot of them, including the majors like Hertz, Avis, Enterprise.

[trader_4]

You can't read plain English. The "excess" is the whole value of the damage or car, if you have no insurance at all. And that is what guys like Micky and me rely on. What they are saying is they cover you for whatever is not covered by other insurance. And if you rent a car, decline to pay extra for their insurance, it's not covered by your personal policy, then they pay for the whole thing.

273.php

"If you don't have personal auto insurance or if you're renting a car in a country where your personal auto insurance isn't in effect, then any card t hat offers secondary coverage becomes primary, so it should theoretically c over the entire cost of the damage.

What do I need to do to make sure I'm covered? Most credit cards require that you do the following in order for their cove rage to kick in:

Decline the rental company's collision damage waiver (CDW/LDW). Be the primary renter of the car. Pay for the car in full with the card that provides the protection."

[trader_4]

And yet they do.

They are in essence self-insured, which is like saying there is no insurance. Hertz isn't going to go buy a policy on collision for their cars. If you wreck it, they come after you, it says so right in the contract. It appears Hub hasn't rented many cars or read a contract. Heck, they even tell you when you're renting it that if you decline the extra cost collision coverage, you are on the hook. They have you initial a statement to that effect.

Their

All the rental companies worth talking about are self-insured. Why wouldn't they be? Hertz can't take the cost of a $20K car? and needs to pay some insurance company? Good grief.

Bingo. You are 100% correct. They cover the "excess" over any other insurance you have. Since you have none, they cover the full amount of damage or loss.

[micky]

This is the part I don't understand. Wy do they insist you refuse the waiver. Accepting the waiver is that you pay for insurance and the rental company waives its right to sue you, except for the deductible on the insurance you have bought. So if the customer accepts the CDW, he buys insurance and is only liable for the deductible.

So why isn't the credit card company happy he did that and why is it not willing to pay the deductible? That seems better for them than paying everything. And even though it's not in the customer's interest to pay for insurance if the credit card company is already insuring him, a lot of people will do it anyhow a) because they just want to pay and leave, b) it's all wrapped together in one number, c) they don't want to dicker or look to the counter clerk like they're dickering, and d ) you can never have too much insurance. Plus many people would not even think of refusing the CDW if the credit card company didn't insist that they could (and must if they want CC insurance).

So why does the CC company insist you refuse it?

Actually and FTR, I've rarely rented cars and never refused the fee, but this rental is longer than a weekend and it would be a lot more money.

I wonder how often people who have collision insurance on their car refuse the CDW** and I wonder how many personal car insurance policies will pay for damage to rental cars, or if there are other restrictions.

**I'm sure some of the time they buy it anyhow, and that lets their own car insurance off the hook.

Plus some rental companies, esp. I suppose where the law requires renters to have damage and theft insurance, require the customer to provide something in writing to show that the CC is insuring the customer.

For example, from a supposedly 3rd party page, so things might have changed by now: "If you are using a Chase Credit Card for Car Rental Insurance whether Visa or MasterCard, you are now covered for CDW and TP. You can easily request a letter of coverage by calling the number on the back of your card to be forwarded to the department that will send you an instant email of coverage or call 1-888-880-5844 (intended for United cards but always works for me when calling for any other chase card). Our recommended card is the Chase Sapphire Preferred Card. You can apply for it HERE and earn 50,000 Bonus points. "

[micky]

You're right. I was thinking about liability insurance, that benefits someone other than the insured. It's liability insurance for which a corporation has to prove that it has sufficient assets to be a self-insurer. For example, a truck it owns could drive into a crowd and kill 10 people. If you're a neighborhood bakery with one shop, you can't afford to pay for that, so they force you to buy outside insurance,

If a company doesn't have the assets to self-insure their own property, that's their tough luck.