How the Best Credit Cards for Car Rental Insurance in Canada Work
Determining if you should buy car rental insurance is confusing. It’s even more confusing when the rental agent gives you a hard sell at the counter and asks “are you sure your credit card covers that?” To play it safe, many Canadians opt in for the optional insurance offered by the car rental agency, but that could be a mistake.
Although your credit card car rental insurance probably won’t cover all your needs, it likely does provide at least a decent amount of insurance. More importantly, if you accept the collision damage waiver (CDW) or loss damage waiver (LDW) from the agency, your credit card car rental insurance will likely no longer be valid.
To help you figure out what your credit card covers you for, we’ve put together this credit card car rental insurance guide that will answer all your questions. Remember, every travel insurance policy is different so you always need to read the fine print.
In This Article:
Summary of Car Insurance Coverage Per Credit Card
|Annual Fee||Coverage Amount||Number of Days Covered||Additional Coverage||Card Review|
|Rogers World Elite Mastercard||$0||$65,000||31||N/A||Read More|
|BMO Ascend™ World Elite®* Mastercard®*||$150||$65,000||48||Accidental Death & Dismemberment; personal effects||Read More|
|MBNA Harley-Davidson® Platinum Plus® Mastercard®||$0||$65,000||31||Accidental Death & Dismemberment; personal effects||Read More|
|CIBC Dividend Platinum® Visa* Card||See terms||$65,000||48||N/A||Read More|
|The Platinum Card®||$699||$85,000||48||N/A||Read More|
What You Need to Be Covered for When Renting a Car
There are a number of important considerations when renting a car in Canada, and whether or not to get rental insurance is one of those dilemmas that often stumps people. When renting a car you should consider the possibility of misfortune to your own vehicle/property, as well as the vehicles/property of others. These are the types of coverage you need to keep an eye out for:
- Damage to the rental vehicle
- Theft of the rental vehicle
- Damage to another person’s vehicle
- Injury to yourself or another person
- Property damage or loss
- Loss of use of the rental vehicle while it’s under repair
Generally speaking, as long as you charge the full amount of the rental to your credit card and decline the rental company’s collision damage waiver, your credit card car rental insurance will cover you for damage/theft to the rental vehicle, and the loss of use of the rental vehicle while it’s under repair. Some cards may also offer additional coverage beyond just the basics.
Two key things to understand are as follows: 1. Despite the fact that your policy may say it covers you for $65,000 or $85,000 in damages, that usually maxes out at the current value of the car. 2. Your credit card car rental insurance will not provide third-party liability, which covers damage to another person’s vehicle and injury to another person. Each province in Canada sets its own level of minimum third-party liability that must be provided by the rental company. The minimum amount of third-party liability insurance required by law in Canada is $200,000, but many car rental companies have policies that cover you up to $1,000,000. Within Canada, you needn’t purchase additional liability insurance since it’s legally required to come with the car.
If you’re renting a car in a country where there are no laws about liability insurance, you can likely purchase additional insurance directly from the car rental agency so that you’re covered there. If you own a vehicle and have car insurance at home, check your policy as it may already include third-party liability insurance that you can utilize abroad.
What to Watch Out For
If you want to take advantage of your credit card’s card rental insurance, there are several conditions and exclusions you should be aware of prior to renting a vehicle:
- You must be a Canadian citizen with a valid driver’s license.
- You must charge the full amount of the rental to your credit card.
- Some types of vehicles are usually not covered, such as pick-up trucks, commercial vans, antique cars, motorcycles, and luxury cars (over $65K or $85K in value).
- Travel in some countries may not be covered by your credit card’s car rental insurance, e.g. in countries for which the Canadian government has issued a formal travel advisory.
- Your credit card account must be in good standing.
- 31-48 days of rental is the maximum that your credit card will likely insure you for.
- If you book your car rental as part of a travel package, you’re still required to charge the full amount of the rental to your travel credit card.
- If your car rental is provided due to winning a contest, your car rental insurance would apply if you have a history of paying your car rentals with the credit card that includes car insurance.
- In most cases, if you book your car rental with points, then your car rental insurance would apply assuming the points you use come from the credit card that offers credit card car insurance.
How you use the rental car may also affect your ability to make a claim. Most policies don’t allow you to use your rental car for commercial purposes, which includes moving your own stuff. Your policy would also be void if you get into an accident while under the influence of drugs or alcohol.
Best Credit Cards for Car Rental Insurance
Though many credit cards’ car rental insurance policies have overlapping features, there are some distinctions from card to card that are worth noting.
Rogers World Elite Mastercard
Best Credit Card for Car Rentals in the United States
If you travel regularly to the United States, you should probably look for a credit card that both provides car rental insurance and helps you defray foreign transaction fees. Enter the Rogers World Elite Mastercard, which covers a car rental up to 31 days, and offers payouts of up to $65,000 in damages. The card has no annual fee and gives 3% cash back on USD purchases, enough to cover the 2.5% foreign transaction fee and add an extra 0.5% cash back on top. Those are some great features for a card with no annual fee, but keep in mind that the Rogers World Elite Mastercard does have a relatively high minimum annual income requirement of $80,000 for an individual or $150,000 for a household, which may exclude a number of potential applicants.
BMO Ascend™ World Elite®* Mastercard®*
Best Credit Card for Additional Coverage
The BMO Ascend™ World Elite®* Mastercard®* is one of the few credit cards that includes a car rental personal effects benefit as part of its car rental insurance policy. What this means is that any personal property stolen in your car rental is covered up to $1,000 per person with a maximum of $2,000 per vehicle*.
The card also provides car rental accidental death and dismemberment benefits*. Obviously it’s a claim that you’ll hopefully never have to make, but the card entitles you (or your beneficiary) to lump sum payouts depending on your loss as a result of an accidental bodily injury while occupying an eligible rental car. For example, you’d be paid $50,000 if you lose a thumb or $200,000 if you suffer a loss of life.
*Terms and conditions apply
MBNA Harley-Davidson® Platinum Plus® Mastercard®
Best No Annual Fee Credit Card
The MBNA Harley-Davidson® Platinum Plus® Mastercard® offers an impressive level of car rental insurance for a card that doesn’t charge an annual fee, providing up to 31 days of coverage with a maximum Collision Damage Waiver benefit of $65,000. Plus it matches the coverage levels for personal effects and accidental death and dismemberment provided by the BMO World Elite Mastercard, which is an unexpected benefit for a no annual fee card (that coverage is not included with the Rogers World Elite Mastercard, for instance).
The Harley-Davidson® card is different from the other rewards cards featured on this page in the sense that it’s geared specifically toward motorcyclists: It earns 1 Harley-Davidson® Genuine Rewards Point for every $2 in purchases‡, and the points are redeemable toward Harley Chrome® cash‡. These certificates can then be exchanged for Harley-Davidson® motorcycle apparel, accessories, service, and more. Every card purchase earns cardholders an additional entry in raffles to win a Harley-Davidson® motorcycle, with four draws done annually^. Interest on card purchases is 19.99%; cash advances and balance transfers have a 22.99% interest rate.
Sponsored advertising. MBNA is a division of The Toronto-Dominion Bank (TD) and TD is not responsible for the contents of this site including any editorials or reviews that may appear on this site. For complete information on this MBNA credit card, please click on the “Apply Now” button.
^No purchase necessary. Contest closes at 11:59 PM ET on December 31, 2022. Please click on the “Apply Now” button for promotional periods and additional terms and conditions.
*This offer is not available for residents of Quebec. For residents of Quebec, please click here.
CIBC Dividend Platinum® Visa
Best Credit Card for Lower-Income Applicants
The CIBC Dividend Platinum® Visa’s car rental insurance is competitive with other credit cards featured on this page, providing coverage on rental vehicles with an MSRP up to $65K for up to a 48-day rental period†. But what makes it stand out from other cards providing similar rental car insurance levels is its accessibility: It’s available to those with an annual income of $15,000 or more†, whereas most cards providing strong rental car insurance require a minimum annual income of $80K or so. Its annual fee is also on the comparatively low side, at $99 per year with a fee rebate for the first year†, and interest rates are: 20.99%† Purchase Annual Interest Rate, 22.99%† (for non-Quebec residents only) Cash Advance Annual Interest Rate, and 22.99%† (for non-Quebec residents only) Balance Transfer Annual Interest Rate. Just check your credit score before applying to make sure it’s in the good/excellent range, between around 740-850.
Another thing that makes the CIBC Dividend Platinum® Visa stand out is that it’s a cash back card, whereas most credit cards that provide strong rental car insurance are oriented toward travel rewards. If you prefer the seamlessness of earning cash back, you might gravitate toward the CIBC Dividend Platinum® Visa’s high 3% cash back earn rate on eligible gas and grocery purchases after the Welcome Offer ends†, 2% cash back on eligible transportation, dining purchases and recurring payments†, and 1% cash back on all other purchases.†
Quebec Residents: Learn More about this CIBC product here
Résidents du Québec : Pour en savoir plus sur ce produit CIBC, suivez ce lien
The Platinum Card®
Best Premium Automotive Benefits Credit Card
A premium rewards card with a premium price tag of $699, The Platinum Card® comes with many benefits that cardholders enjoy when driving or parking. Its Car Rental Theft and Damage Insurance can cover you for theft, loss, and damage of your rental car with an MSRP of up to $85,000 for rentals of 48 days or less when you fully charge your rental to The Platinum Card®. To take advantage of this protection, simply decline the Collision Damage Waiver (CDW), Loss Damage Waiver (LDW), or similar option offered by the car rental agency*. When driving into or parking at Toronto’s Pearson Airport, cardholders will appreciate complimentary valet service at Express and Daily Parking, plus 15% off there as well.
Other exclusive benefits of The Platinum Card® are its $200 CAD annual travel credit, status at global hotel brands, a Welcome Offer of up to 80,000 Membership Rewards® points (conditions apply), unlimited and free access to 1,300+ worldwide airport lounges, and an extensive suite of travel insurance.
This post was not sponsored. The views and opinions expressed in this review are purely my own.
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