Coverage obtained through credit card benefits related to vehicle rentals offers financial protection against damage or theft of the rented vehicle. As an example, if a renter utilizes a specific credit card to pay for the rental and declines the rental company’s collision damage waiver (CDW), the credit card’s insurance benefit may cover the costs associated with repairing or replacing the vehicle if it is damaged or stolen.
This type of coverage can provide significant financial advantages, potentially saving individuals from incurring substantial out-of-pocket expenses in the event of an accident or theft. Historically, these benefits were introduced as a value-added feature to enhance the attractiveness of credit card offerings and provide cardholders with a convenient alternative to purchasing supplemental insurance from rental companies.
