GREENSBORO, N.C. — It happens every time you go on vacation and you rent a car. As you're picking up the car, the rental car company person asks if you want to buy the insurance.
I used to think, that’s what I have auto insurance for, right?
“Your car insurance company will pay for the damage that you cause to another party and to the car. What your car insurance in our state won't pay for is the lost revenue to the rental car agency which can be quite expensive if you think about you totaled a car, they can't replace it for 30 days, what is your daily cost of renting that car for them,” said Christopher Cook of Alliance Insurance Services.
What car rental companies typically sell at the counter is called a Collision Damage Waiver. When you buy it, the company won't come after you for the lost revenue if the car is damaged or stolen.
Here's the thing, you might be able to get this protection without actually paying for it. How? Your credit card.
“A lot of credit card companies offer that as a member perk,” said Cook.
Nerdwallet recently did an article on this. Basically, you need to call your credit card company and ask four questions. Here is a quick takeaway from their article.
Is the rental car coverage primary or secondary?
According to Nerdwallet, most are secondary, which means your regular insurance deductible will have to be paid first.
How do I make sure the coverage applies to my rental?
Usually, the answer is you have to use that card to pay for the rental car.
What coverage is included?
There may be more than just the collision waiver. Nerdwallet had several other coverages that would really come in handy.
What isn't covered?
Usually what isn't, is covered by your regular auto insurance policy.