credit cards and car rental insurancePhoto Credit: Pixabay

We had hoped that Citibank's decision last year to drop car rental insurance as a travel benefit was an isolated incident, but other credit card issuers followed suit and are chopping travel benefits from the roster of perks offered to cardholders.

For example, American Express has put new limits on Centurion Lounge access and stopped offering Priority Pass restaurant credit. And the most coveted credit card for travelers, the Chase Sapphire Reserve Card, hasn't changed its raft of benefits but recently hiked its annual fee by a whopping $100, to $550.

Why should you care? Because travel benefits translate to savings. If you pay for your car rental with a credit card that offers insurance as a benefit, you can decline the pricey collision insurance offered at the rental car counter. This can save you more than a hundred dollars on a week-long rental.

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If your credit card does not offer car rental insurance, then you are in a bit of a pickle. If you own a car and have auto insurance, then your policy will likely extend to rental cars. The problem is that there is likely a hefty deductible and limitations on what is covered, which can leave you with gaps in protection. Furthermore, relying on your auto insurance policy is fraught with another kind of risk. A 2017 study by and Quadrant Information Services found that filing a single auto insurance claim of at least $2,000 will spike your premium by 44.1%, on average.

Before renting a car, it's always smart to double check to see what, if any, car rental insurance is included as a benefit by your credit card issuer.

And, of course, you can never compare credit cards based on just one benefit, such as car rental insurance. You should take into consideration all costs, including a card's interest rate and annual fee. Card benefits might seem lucrative on the surface, but those savings can easily be outweighed by hefty interest charges or other fees.


Citibank-Issued Credit Cards Have Chopped Travel Benefits


Do you have a credit card issued by Citibank? Last year, Citi drastically cut back the travel benefits offered to credit card holders for the vast majority of Citi-issued cards. Among the perks that were dropped was car rental insurance.

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Notably, Citi has not eliminated key travel benefits for their co-branded Costco cards, which offer the following perks: worldwide car rental insurance, worldwide travel accident insurance, roadside assistance dispatch service, damage and theft protection and more.


Kroger Mastercard is Reportedly Dropping Car Rental Insurance


In addition, the US Bank-issued Kroger 1-2-3 Rewards Mastercard has discontinued offering car rental insurance and other travel protections.


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