by Theresa Michael

Created on: January 19, 2009

When you flew the nest as a newly minted adult, your father probably gave you some sage advice, which probably sounded a little silly for most of it but one thing may have stood out when you went to get your first rental car. "Don't get the insurance they offer you. It's a scam and just a way for them to get more money. Your credit card will cover insurance on the car." While dear old dad may have just been trying to help you not get sold a bunch of stuff on the rental that you don't need, his advice here may have been inncorect. As I learned while working for a major credit card issuer not all credit cards offer the rental car coverage that dad was talking about. Usually you will only find the rental coverage on Platinum cards or better but occasionally you will find it on a gold card (the American Express gold card is an example of a Gold card that has the rental coverage). Just because you card has this coverage, however, don't waive the rental company's insurance just yet. Do you know what exactly the card covers? In some cases it will cover everything. In others it will only cover damage to the car, as long as you make the reservation and the final payment with the credit card. Sometimes it will only cover minor damage. You can find out what exactly your card covers in the credit card's Terms and Conditions, that thick booklet that is about the size of a dollar bill and has print so small you need a high powered telescope just to read. If you don't have this book anymore (who does?), you can call your credit card company. They can tell you, right over the phone if your card has Rental coverage on it and can direct you to the company that handles all inquiries and claims so that you can discover exactly what kind of coverage the card provides. There is no coverage provided when you use your Debit card, even though it can be used like a credit card, so keep that in mind. Also make sure you ask the Rental company what their insurance covers before you delcline it. It may cover more than what you credit card's insurance cover. You may also want to call your car insurance coverage to see if your current insurance policy will cover a rental as well. If your insurance policy won't cover you in a rental then you may want to consider buying the rental company's insurance regardless of if your credit card has coverage or not. So while dad may have had your best interests at heart when he gave you that rental car advice, make sure you do your research first before you decide if you are going to take it.

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