The Best Credit Cards That Offer Free Car Rental Insurance in Canada 2021

How many times have you been faced with the decision on whether or not you should purchase car rental insurance while at the car rental company?

It always catches me by surprise when the customer rep at the car rental agency asks if I want auto rental insurance and emphasizes why I need it so badly. I just never really think about insurance before venturing to rent a car.

Car rental insurance sold as Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) does not come cheap. At up to $30 per day, you could easily be on the hook for approximately $1,000 for a 30-day rental and it is often more expensive than the rental fee itself.

So, should you pay for the car rental insurance offered by the car rental agency? It depends.

There are several no-fee credit cards (and most premium cards) offering free rental car insurance coverage that protects your rental car against collision damage and loss, subject to specific conditions. They also cover the costs of towing and loss of use fees charged by the rental company.

If your credit card offers free rental car insurance benefits, you can save lots of money every time you rent a car!

What Does Credit Card Rental Car Insurance Cover?

Credit cards that offer Rental Car Collision and Loss Damage Insurance often provide coverage for:

  • Damage to the rental vehicle
  • Loss/theft of the rental vehicle
  • Towing charges, and
  • Loss of rental car use fees

In general, you need to decline the rental company’s collision damage (CDW) and/or loss damage (LDW) waiver coverage in order for your credit card’s rental car company insurance to kick in. Credit card companies also require that you pay for the entire cost of the car rental using your card and rent it out in your name.

Best credit cards with rental car insurance in canada

What Is Not Covered by Credit Card Car Rental Insurance?

Most credit cards do not offer any third-party liability coverage or protection for personal injury and damage. For example, if the other party’s vehicle is damaged or they are injured, this is not usually covered by your credit card car rental insurance. If you own a personal car that is insured, your third-party liability coverage may already cover you in a rental car.

A minimum level of third-party liability also comes with all rental cars in Canada by law. The minimum amount starts at $200,000 and may be up to $1,000,000 depending on the province and/or car rental company. This minimum coverage is already factored into your car rental and does not require an additional fee.

If you are driving a rental car outside of Canada, the minimum liability insurance coverage at your location may vary wildly and be so minimal that it potentially exposes you to significant out-of-pocket costs. In this case, it becomes especially important to ensure that you have personal third-party liability coverage in place.

Credit card auto insurance provides coverage for a limited number of days, usually between 31-48 days. If your rental exceeds the maximum length of time (e.g. 48 days), no coverage will be provided.

Other exclusions or limitations that may apply include:

  • Some countries may be excluded from coverage e.g. may be limited to North America.
  • Not all vehicles are covered e.g. trucks, pick-up trucks, off-road vehicles, trailers, motorcycles, recreational vehicles, mini-buses, antique cars or exotic cars, and very expensive vehicles exceeding a defined manufacturer’s suggested retail price (MRSP) at the time of loss or damage.

Read your credit card agreement in detail to know what is covered and what is excluded.

Best No-Fee Credit Cards Offering Rental Car Insurance Benefits in Canada

These credit cards do not charge an annual fee and provide free rental car insurance, often referred to as Rental Car Collision/Loss Damage insurance.

1. Scotiabank American Express

The Scotiabank American Express card is a great no-fee card and is related to the Scotiabank Gold American Express which is the premium version of the credit card.

Car Rental Insurance

This card offers car rental insurance that protects against theft and damage for up to 48 consecutive days and $65,000. You must rent the car in your name and pay the rental fee with your card or by using your Scotia Rewards points. A notice of claim must be filed within 90 days.

Other Benefits of the Card

  • No annual fee
  • $50 bonus (5,000 points) when you spend up to $500 in the first 3 months
  • Earn 1 Scotia Rewards point for every $1 you spend on everyday purchases
  • Save up to 25% on car rentals at participating AVIS and Budget locations
  • Travel emergency medical insurance
  • Travel accident insurance
  • Trip interruption insurance
  • Extended warranty and purchase protection
Scotiabank American Express Card

Apply for this Card.

2. Tangerine World Mastercard®

The brand-new Tangerine World Mastercard® is the second no-fee credit card offered by Tangerine Bank. It offers some of the best cash back rewards available in Canada and also has an impressive 1.95% balance transfer rate for 6 months!

Note that a minimum personal income of $60,000 is required to apply for this card.

Rental Car Insurance

This card offers car rental insurance when you charge the full cost of the rental to your card. The coverage protects you for up to 31 consecutive days

Other Benefits of this Card

  • No annual fee
  • 4% cash back for your first 3 months and unlimited 2% cash back on spending in up to 3 major categories thereafter
  • 1.95% promotional balance transfer rate for 6 months
  • Mobile device insurance (up to $1,000)
  • Extended warranty and purchase protection
  • Mastercard Airport Experiences provided by Loungekey with access to exclusive offers at more than 400 airports worldwide

Get more details in this review.

Tangerine World Mastercard.

Sign up for this Card.

3. Triangle World Elite Mastercard

The Triangle World Elite Mastercard is managed by Canadian Tire Corporation and is included on my list of the best no-fee credit cards in Canada.

Rental Car Insurance

This card offers car rental collision and loss damage waiver insurance when you rent most passenger vehicles for a period not exceeding 31 consecutive days. You must rent out the car in your name, pay for it using your card, and decline the rental agency’s CDW.

The maximum MSRP value of the vehicle covered is $65,000 and you must report a claim within 48 hours. A minimum personal income of $80,000 is required to apply for this card.

Other Benefits of this Card

  • No annual fee
  • 4% in CT Money when you shop at Canadian Tire and their partner stores
  • 3% in CT Money on your grocery purchases (excluding Costco and Walmart)
  • 5-7 cents per litre when you buy gas at Gas+/Essence+ locations
  • Free Gold Plan Roadside Assistance worth $99 per year (within Canada and the U.S.)
  • Extended warranty and purchase protection

Get more details in this Triangle World Elite Card review.

Sign up for this card.

4. PC Financial World Elite Mastercard

The popular PC Financial World Elite card is one of the best credit cards for earning cash back if you shop at Superstore and Shoppers Drug Mart.

Car Rental Insurance

They offer car rental insurance that covers damage and theft for up to a period of 31 consecutive days. As expected, you must decline the car rental’s CDW/LDW, rent the car in your name, and pay the entire cost of the rental using the card.

The maximum car value covered is up to $65,000, and you must report a claim to the insurer, American Bankers Insurance Company of Florida within 48 hours of a loss or damage.

A minimum personal income of $80,000 per year is required to apply for this card.

Other Benefits of this Card

  • No annual fee
  • Earn 45 PC Optimum points per $1 spent at Shoppers Drug Mart
  • Earn 30 PC Optimum points per $1 spent at Superstore (3% rewards rate)
  • Earn 30 points per $1 spent at PC Travel
  • 10 points per $1 spent on all other purchases
  • 3 cents per litre when you buy gas at Mobil or Esso stations
  • Travel emergency medical insurance (up to 10 days)

The PC Financial Mastercard is great for earning PC Optimum points and free groceries.

PC financial world elite mastercard

Sign up for this Card.

5. Home Trust Preferred Visa

The Home Trust Preferred Visa card is issued by Home Trust and considered one of the top cards for avoiding 2.5% or more in foreign currency surcharges when you make purchases in a foreign currency and for free roadside assistance.

Car Rental Insurance

This card provides an auto rental collision and loss insurance that is underwritten by Royal Sun and Alliance Company of Canada. The car rental insurance coverage provided by the card is basic and similar to the other no-fee cards.

Other Benefits of this Card

  • No annual fee
  • 1% unlimited cash back on all purchases
  • Free Roadside Assistance
  • $0 FX-markup fee
  • Purchase protection
Home Trust Preferred Visa

Sign up for this Card.

5. Rogers World Elite Mastercard

The Rogers World Elite Mastercard is provided by Rogers Bank and is on my list of the best no foreign transaction fee cards in Canada.

Rental Car Insurance

This card offers rental car collision/damage insurance that is underwritten by CUMIS General Insurance Company and provides coverage for a maximum of 31 consecutive days. You must be a Canadian resident, rent the car in your name, and pay the full rental costs with your card. You must also decline the rental car agency’s waiver.

This car rental insurance covers up to $65,000 in damage or loss. A minimum personal income of $80,000 is required.

Other Benefits of this Card

  • No annual fee
  • 3% cash back on USD purchases
  • 1.50% cash back on all other purchases
  • Extended warranty and purchase protection
  • Out-of-Province and Out-of-Country medical, trip cancellation/trip interruption protection

Read our review of the Rogers World Elite Mastercard.

Best Premium Credit Cards With Rental Car Insurance in Canada

These cards come with an annual fee and premium benefits in addition to car rental insurance.

7. Scotiabank Gold American Express Card

The Scotiabank Gold AMEX card has one of the best car rental coverages and comes with an annual $120 fee tag.

Car Rental Insurance

This card offers car rental insurance covering up to 48 consecutive days per rental period and up to $65,000 in value.

Other benefits of the card are:

  • $250 bonus (25,000 Scotia Rewards points) when you spend $1,000 in the first 3 months
  • 5 points per $1 spent on groceries, dining, and entertainment
  • 3 points per $1 spent on gas and daily transit
  • 1 point per $1 spent on all other purchases
  • Travel emergency medical insurance up to $1 million
  • No foreign transaction fee (savings of 2.5%)
  • Trip cancellation, trip interruption, flight delay, delayed and lost baggage, and travel accident insurance
  • Hotel/motel burglary insurance
  • Purchase protection and extended warranty
  • Discounted Priority Pass membership (35% off)
Scotiabank Gold American Express Card

Sign up for this Card.

8. Scotiabank Passport Visa Infinite

This premium travel rewards card from Scotiabank comes with a $139 annual fee. It is one of the best no foreign transaction fee card in Canada.

Car Rental Insurance

The Scotiabank Passport Visa Infinite protects you against rental car damage and theft for up to 48 consecutive days and a maximum of $65,000.

Other benefits of the card include:

  • 20,000 bonus points ($200 value) when you spend $1,000 or more in the first 3 months
  • 2 Scotia Rewards points per $1 spent on groceries, dining, entertainment and transit
  • No FX transaction fee
  • 1 Scotia Rewards point per $1 spent on all other purchases
  • Complimentary Priority Pass membership plus 6 free VIP airport lounge visits per year ($261 value)
  • Travel emergency medical insurance
  • Trip cancellation/trip interruption and flight delay insurance
  • Delayed and lost baggage insurance
  • Travel accident insurance against loss of life or dismemberment
  • Purchase protection and extended warranty

Learn more about the card in this review.

Scotiabank Passport Visa Infinite Card

Apply for this Card.

9. American Express Gold Rewards Card

This premium card comes with a good number of travel rewards and benefits and has an annual fee of $150.

Car Rental Insurance

The rental car insurance covers damage or theft up to an MSRP of $85,000 and 48 consecutive days. Don’t forget to decline the car rental agency’s CDW or LDW and pay the rental fee with your card to qualify for this coverage.

Other benefits of the card:

  • Welcome bonus of 25,000 points when you spend up to $1,500 in the first 3 months
  • Earn 2 points per $1 spent on travel, gas, grocery, and pharmacy purchases
  • Earn 1 point per $1 spent on all other purchases
  • Comprehensive travel insurance benefits including emergency medical (up to $5 million), trip interruption, lost or stolen baggage, flight delay, and travel accident insurance
  • Purchase protection and extended warranty
American Express Gold Rewards Card

Apply for this Card.

10. BMO World Elite Mastercard

The BMO World Elite Mastercard comes with a $150 annual fee (waived in the first year).

Car Rental Coverage

This card offers car rental insurance for up to 48 days and up to a maximum of $65,000. In addition to the basic coverage for loss and damage to a rental car, it also provides car rental accidental death and dismemberment benefits of up to $200,000 for the primary cardholder.

Also, your personal effects are protected against theft or damage up to $2,000 per account during each rental period.

Other benefits of the card:

  • 3 BMO Rewards points for every $1 spent on travel, dining, and entertainment
  • 2 BMO points per $1 spent on all other purchases
  • Trip cancellation, trip interruption, trip delay, and flight delay benefits
  • Baggage and personal effects benefits
  • Out-of-Country/Out-of-Province emergency medical benefits up to $2 million
  • Purchase protection and extended warranty
  • Complimentary membership in Mastercard Airport Experiences provided by LoungeKey plus 4 annual complimentary passes

Here’s a detailed review of the BMO World Elite Mastercard.

BMO World Elite Mastercard

Apply for this Card.

Save on Car Rental Insurance

These credit cards can help you save money when you rent a car. Remember to check your coverage details before arriving at the rental car company so you can make the right decisions when asked about whether or not you want to pay for Collision Damage/Loss Damage waivers.

If you choose to go with the coverage provided by your credit card, you should rent the car in your name and pay all the rental costs using the appropriate card. If you need to report or make a claim, do so immediately if possible to avoid any problems.

Related Posts

Retirement 101 eBook - 3D

Join Our Newsletter!

Sign up now to join thousands of other visitors who receive our bi-weekly newsletter and latest personal finance tips. You will also receive our FREE eBooks.

Author

Photo of author
Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. His writing has been featured or quoted in the Toronto Star, The Globe and Mail, MSN Money, Financial Post, Winnipeg Free Press, CPA Canada, Credit Canada, Wealthsimple, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO and monitors his credit score for free using Borrowell.

5 thoughts on “The Best Credit Cards That Offer Free Car Rental Insurance in Canada 2021”

  1. Hi Enoch, thanks for this informative article. I have a question about collision damage waiver (CDW). My wife and I travel and rent cars for extended periods. So far we have stayed within the 48 day CDW coverage of our card. In order to go beyond this, what strategy would you recommend? I am thinking of getting a separate card for myself and my wife and each of us renting a car consecutively using different cards. I know of some couples who, after having reached the 31 day limit, return the car for one day then rent a vehicle again with the same card thinking that they will renew the 31 day coverage. I know that this is expressly forbidden in the fine print of the card issuing agreement and so could be disastrous.

    Do you know of any problem that would prevent us from using 2 separate cards for consecutive rentals so that we could double our CDW period? Thank-you.

    Reply
    • @Costa: Great question! Unfortunately, I’m not sure what the right answer is. I want to assume that if you and your wife have credit cards with rental insurance from different card issuers, your proposed plan above should work. The best way to find out is to give the issuers a call and ask them to confirm. We all know that it’s in their interest to avoid paying up if they can find an escape.

      Reply
  2. This is great info, though please add their restrictions.
    I just wasted time trying to sign up for the first one, but don’t meet their ‘qualifications’. I know for the PC one mentioned, your income must be $6000. So there’s no point in trying if you don’t have that high an income.

    Thank you.

    Reply
Leave a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Learn how to master your money
Millions of Canadians visit annually to read our latest personal finance tips. Subscribe to receive our bi-weekly newsletter and free eBooks.
We hate SPAM as much as you do. You can always unsubscribe...
Learn how to master your money

Millions of Canadians visit annually to read our latest personal finance tips.

Subscribe to receive our bi-weekly newsletter and free eBooks.

We hate SPAM as much as you do. You can always unsubscribe...
Success!
Please click the link in your email to complete your subscription and download your free ebooks!
Please click the link in your email to complete your subscription and download your free ebooks!
Success!
The content on this website includes links to our advertisers or partners and we may receive compensation when you sign up, at no cost to you. This does not impact the objectivity of our reviews or evaluations, but it may impact which products or services we write about and where and how they appear on the site. Savvy New Canadians is for informational purposes only and is not intended to substitute professional financial advice. Read our disclosure.
Savvy New Canadians is for informational purposes only and is not intended to substitute professional financial advice. The content on this website includes links to our advertisers or partners and we may receive compensation when you sign up, at no cost to you. This does not impact the objectivity of our reviews or evaluations, but it may impact which products or services we write about and where and how they appear on the site.
10 Shares
Share
Pin
Tweet
WhatsApp
Reddit