Most business credit cards provide insurance for rental car vehicles.
(article continues below)
Let's say you're on a business trip and need to rent a car. The rental car company asks you whether you'd like to get insurance on the rental car.
The cost for the rental car insurance? It's an extra $20 per day. Should you get the insurance?
In most cases, there's no need to get the rental car insurance. With high probability, you are covered via the credit card you will be using to rent the car. In the event of an accident or theft, your credit card company will reimburse you for the repair or replacement of the rental vehicle. They will even cover the towing charges if the vehicle has to be towed to a repair shop.
However, there are a few things you should know about the rental car insurance that business credit cards provide.
Only Business Use Is Covered
If you use your business card to rent a car and have an accident while using the car for personal use, you may not be covered or may have limited coverage. You are fully covered if you are using the car for business purposes.
You Have to Have Used the Credit Card to Rent the Car
Just having the credit card in your wallet doesn't entitle you to rental car insurance. You have to have actually used the card to rent the vehicle.
Only Authorized Drivers Are Covered
If you lend a rental car to a friend and they have an accident, the accident will not be covered by your business credit card rental car insurance. Typically, this insurance only covers primary renter of the vehicle, and any additional drivers permitted by the auto rental agreement.
Rental Car Coverage Is Often Time-Limited
Typically, there is a time limit on how long you can rent a vehicle and still have credit card insurance cover any accidents or theft. For example, if you have a Visa business credit card, you are only covered for a maximum of thirty-one days. In other words, if you are a management consultant renting a car for six months for an out-of-town project, don't assume that you will be covered that entire time.
You Must Report Your Vehicle Accident or Theft
In most cases, you have up to a maximum of forty-five days to file a claim. After that, you may be out of luck. However, the smartest thing to do is to file a claim at the soonest possible opportunity. Don't call the accident in and forget to fill out the claim form. Even if you called the accident in, you will not be covered if you neglect to complete the claim form.
Many Things Are Not Covered
If something you own is damaged within the vehicle, it probably won't be covered. Similarly, if you damage something else outside the vehicle, that will not be covered. The coverage only applies to the vehicle itself.
Personal injuries are not covered. That includes you or a passenger being injured or your injuring somebody else.
If you are under the influence of alcohol, intoxicants, or drugs, or engaging in illegal activities, you won't be covered.
You also won't be covered if you are overtly negligent in your obligation to protect the vehicle. If you leave the vehicle running and unattended in a rough neighborhood, don't expect any sympathy from the claims adjuster!
Some car types are not covered at all. For example, you may not be covered if you rent an expensive, exotic, or antique car. Wouldn't that suck - to total a rented Lamborghini and then find out you don't have any coverage? If you are unsure whether you are covered for a particular car, call your credit card company and ask.
Finally, be aware that business credit card rental car insurance coverage does not apply in some locations. For example, Visa will not cover you for losses when you rent a car in the Republic of Ireland, Northern Ireland, Israel or Jamaica.