Title: Navigating Car Rental Insurance Claims When Using Points: A Case Study
Understanding the intricacies of credit card travel insurance can be complex, especially when loyalty points come into play. Here’s an illustrative scenario highlighting potential pitfalls and considerations for travelers relying on premium credit card coverage.
Case Overview
A traveler rented a vehicle from Enterprise using their online booking platform. To reduce expenses, they redeemed loyalty points, resulting in a remarkably low upfront cost—just $5.47—charged entirely to their Chase Sapphire Reserve (CSR) credit card. The card’s benefits include primary rental car insurance, provided the full rental fee is charged to the card and the car rental company’s collision damage waiver (CDW) is declined.
The incident
During the rental period, the driver experienced a minor accident. After returning the vehicle, they submitted a claim to their card’s insurance provider, Virginia Surety/Assurant, expecting coverage. Traditionally, claims processes smoothly, but this time, the insurer delayed, demanding additional proof: a credit card billing statement confirming the total charged amount. Despite multiple submissions showing the $5.47 charge on the rental date, the insurer persists in requesting this documentation, raising concerns about claim denial.
Key Concerns and Considerations
-
Claim Denial Due to Reduced Rental Price:
The primary issue appears to be whether a significantly discounted rental—achieved through loyalty points—affects eligibility. The insurance policy states that the full rental amount must be charged to the credit card, but does not specify whether discounts or use of points invalidate the claim. -
Policy Language and Interpretation:
The terms mandate charging the “full amount” to the card. Given that only $5.47 was charged, and the entire amount was captured on the statement, there is a strong argument that the condition is satisfied. However, insurers may interpret “full rental cost” as the undiscounted rate, especially if their internal policies or some ambiguity exists. -
Loyalty Points and Insurance Coverage:
Many credit card travel policies do not explicitly disqualify claims based on the use of points or discounts—yet, some providers or underwriters might interpret the policy differently, potentially viewing the heavily reduced charge as insufficient for coverage. -
Legal and Practical Steps Forward:
- Review Policy Details: Examine the official terms and conditions of your credit card’s rental insurance. Look for clauses related to discounts, points, or partial payments.
