Should you buy American Express Premium Car Rental coverage?

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American Express car rental coverage
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While there are more ways than ever to avoid renting a car, it’s sometimes a necessary part of a trip.

Your chief concern whenever you rent a car should always be making sure you’re adequately insured. Your credit card can provide excellent insurance, but it’s also usually full of exclusions that may vary depending on the type of car you rent and its value.

To that end, American Express offers a Premium Car Rental Protection option on all of its cards that is far less restrictive and can be quite affordable, too.

Let’s take a look at this option and see if it might make sense for you.

What’s the cost of American Express Premium Car Rental Protection?

If you choose to opt into this coverage, you’ll be charged $19.95 or $24.95 per rental period — not per day — in most states, depending on your coverage selection.

The cost is $15.95 or $17.95 for California residents and $12.25 or $15.25 for Florida residents.

What are the benefits of this coverage?

When you have the Amex Premium rental car insurance option, it will be your primary policy.

Unlike most credit cards’ rental car insurance, you won’t have to make a claim with your personal insurance to receive benefits. In addition, there’s no deductible to this policy, so you don’t have to worry about some rental car company’s shady practices of finding a scratch that, coincidentally, costs just under the deductible to fix.

The coverage also has much higher limits than the standard policy. While many cards offer $50,000 in coverage for just theft and damage, this policy offers up to $100,000 of coverage for theft and damage, plus up to $15,000 for secondary medical expenses. You’ll also receive up to $5,000 for secondary personal property coverage ($15,000 for Florida residents). If your rental car is broken into and your luggage is stolen, you can receive this benefit.

Most importantly, you’re covered if you rent an expensive car, whether you got a free upgrade or because you decided to splurge. Many credit cards’ standard rental car insurance won’t cover luxury vehicles, SUVs or pickup trucks. The Amex Premium coverage does.

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What are the drawbacks?

American Express’s standard and premium coverage excludes some pretty popular travel destinations, for reasons I’ve never fully understood. That’s why you shouldn’t ever use your American Express card to rent cars in Australia, Ireland, Israel, Italy, Jamaica or New Zealand.

The premium coverage is charged to your card for each rental period, and it’s the same amount for one day or for up to 42 consecutive days (up to 30 consecutive days for Washington State residents). So, the value of this optional coverage goes up with the length of your rental.

If you’re traveling about the U.S. and renting a car for just a day or two here or there, it can be very expensive. But if you’re renting for a week or more, the price per day becomes negligible.

Finally, be very careful to scrutinize your statements when you’ve opted into this coverage. Since the cost is automatically added to each charge from a rental car company, you could be double billed if the rental car company adds additional charges later, such as those for tolls or traffic citations. If this happens, you’ll have to call American Express to have those charges reversed.

Should you opt for this coverage?

I’ve used this coverage several times when renting a car outside of the United States for more than a few days. I especially like having it when I’m in the developing world. For about $20, I enjoy having a zero dollar deductible that makes me feel immune to everything from parking lot scrapes to unscrupulous rental car companies concocting bogus damage claims long after I’ve left the country.

I once made sure to use this coverage when I rented a new Porsche for a few hours in Germany. Even though insurance was included, it had a deductible of nearly $2,000. Realizing that any chip or scratch would be noticed and incredibly expensive to repair, the $25 I paid for the highest coverage seemed like a good idea.

On the other hand, when renting a typical midsize car for a few days in the United States, I don’t think it’s really necessary. If anything happens, I know I’m covered by both my personal auto insurance and my credit card’s standard coverage.

When you understand how American Express Premium Rental Car coverage works best — and what its drawbacks are — you can get the protection you need when you need it at an affordable price.

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