When to count on your credit card for car rental insurance

Maybe you don’t rely on your credit card to cover supplemental auto insurance when you rent a car, but should you? It depends, mostly on what card you use and what type of vehicle you rent, according to a recent study of four top credit cards.

CardHub.com found that travelers could save about $10 to $20 a day on car-rental insurance if they use the automatic coverage that comes with their credit card membership. The report says another study found that 24% of consumers aren’t sure whether their credit cards provide such coverage.

Evaluating the quality of the free coverage using several criteria, CardHub found Visa scored highest, followed by Discover, American Express and MasterCard. (Of the four, only MasterCard doesn’t provide coverage for all cardholders, CardHub says.)

But, the study points out, the coverage takes you only so far. For example, Visa and MasterCard won’t pay for accidents on dirt and gravel roads, and MasterCard excludes accidents that occur on roads that “aren’t regularly maintained,” the report says.

None of the credit cards offers supplemental insurance to cover renting trucks, off-road vehicles or expensive or antique cars, and certain countries are excluded too.

Travelers must charge the rental car on their credit card and decline supplemental insurance/collision damage waivers to receive the benefits of automatic car-rental insurance. (If you buy insurance from the car-rental agency, credit card coverage for an accident will be nullified.)

Check out the 2012 Credit Card Auto Rental Insurance Study by CardHub for more details on coverage.