How to get liability car rental insurance (LDW – Liability Damage Waiver) for free

Posted on August 20, 2014 by in Avis

Since I do not own a car anymore, I have been struggling to solve the mystery of liability insurance for rental cars.

As you may know, almost all credit cards include a complimentary CDW or Collision Damage Waiver insurance. This insurance might be primary or not but usually covers you in case you damage the rental car. Some credit cards have rather random exclusions – eg:

– certain countries like Australia (AmEx) or Israel (Visa)

– certain vouchers that make the coverage ineligible (AmEx)

– deductibles (many MasterCards)

So it's important to read the Term & Conditions but mostly coverage isn't an issue if you have a stack of credit cards available.

The situation is different for liability insurance. To my knowledge (and research) no US credit card offers any liability insurance. Most car insurers will offer liability insurance to you as a driver for $30-$60/month. This coverage usually applies to you personally for any car you drive (your neighbor's, a rental car or your own car).

However, it mostly only covers you in the US and Canada and for most policies not even Mexico is covered. The rest of the world usually isn't covered. The coverage is also rather low with a $60 policy getting you ~$300,000 per accident.

Now the world is split in mandatory liability insurance that comes with every rental (for instance Germany and most of Europe) and no mandatory liability insurance (the US and many countries in Central/South America). Minimum liability insurance in Europe is often 1 – 5 million dollars per accident.

Car rental companies are happy to offer liability insurance (1 million plus in coverage) but against a fee of $8-$15 a day. For a 2-week rental that can easily double the price of the total rental fees.

I have been researching and talking to a number of insurance agents and everyone had good ideas but so far I have not found a stand-alone policy that covers me:

– up to one million dollars per accident

– globally (in all countries)

– for a fee under $20/month

What I have found, though, are several credit cards issued in Germany that DO include liability insurance as complimentary benefit on a global level for all car rentals:

SpardaMasterCard Platinum

Santander MasterCard Gold

Netbank MasterCard Classic / Platinum

I still have a credit history in Germany and I guess it is time to consider a round of applications there. Most credit cards in Germany come with a hefty fee and/or minimal sign-up bonuses, though.

Without a foreign credit history I have not found a solution given my parameters above. Do you know any?

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About the author: Torsten is a serial entrepreneur who started almost a dozen ventures on four continents. Torsten's love for travel has brought him to 130+ countries and travel with most of the world's airlines. You can reach Torsten at [email protected]

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