How to Get Car Insurance While Traveling Abroad

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Last Updated: October 11, 2022 References

Most people's domestic car insurance policies don't cover driving a rental car internationally but there are many options for purchasing insurance that will cover it. The most common are buying insurance through the car rental company, using the insurance provided by your credit card company, and purchasing rental car insurance through your travel insurer. All of these options have advantages and disadvantages, but you'll be able to find one that works for you after a little bit of research and comparison.

Method 1

Method 1 of 3:

Buying Insurance from the Rental Car Company

1
Make sure you are licensed. Not all countries accept US driver’s licenses. If you don’t make a reservation ahead of time, you don’t want to find out that you’re ineligible to rent a car altogether because you don’t have an International Driving Permit. ^{[1]
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- International Driving Permits (IDP) are not too difficult to obtain. You’ll need to fill out an application through the American Automobile Association or the National Auto Club, have a valid US license, two passport pictures, and $20. The AAA application can be found at http://www.aaa.com/vacation/idpf.html .
- You should check with the US Embassy or Consulate at http://www.usembassy.gov/ in the country you’ll be visiting to see if you’ll need an IDP.
2
Understand what you’re buying. Liability coverage for damages to anything outside of the car (damage you or the car inflicts) is usually included in the price of the rental. When you purchase the equivalent of collision “insurance” from the rental car company, it’s actually a Collision Damage Waiver, or CDW. ^{[2]
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- The CDW isn’t actually insurance. Instead, the car rental company is waiving its right to collect the full amount of damage from you in the event of a collision. There may still be a big deductible ($1000 or more) that isn’t covered by the waiver. The basic CDW will cost you about 30% extra.<Re> https://www.ricksteves.com/travel-tips/transportation/car-rental-cdw </ref>
- In order to have no deductible or a very small deductible, you’ll have to purchase an additional waiver, called super-CDW or zero-deductible CDW. The additional waiver can cost another $10-$30 per day.
- In order to have comprehensive protection from theft and other occurrences, you’ll need to purchase additional coverage specifically for loss and theft.
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3
Tell the rental company where you’ll be driving the car. Make sure you let the rental company know what countries you’ll be visiting. Different countries have different risk levels, and what may be a covered occurrence in one country may not be a covered occurrence in another country. ^{[3]
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- Italy and Ireland are two countries with peculiar rules with respect to insurers. If you’re travelling to either country, make sure your rental car company knows ahead of time. ^{[4]
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4
Make sure the rental company knows who will be driving the car. The insurance you purchased may only apply to the people the car company knows will be driving. If they can prove someone else was driving the car when a covered occurrence happened, they may hold you liable for the totality of the damage. ^{[6]
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- You may have to pay $8-$15 extra for each covered driver.
5
Purchase the insurance when you make your reservation. You’ll most likely save money by purchasing the insurance when you make the reservation rather than when you’re at the counter. ^{[8]
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- Not only is the price higher at the counter, it’s easier for the agents to talk you into coverage you don’t need. You’re probably tired, there may be a language barrier, bargaining customs may be more high-pressure, and the terminology may be different.
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Method 2

Method 2 of 3:

Using Insurance from your Credit Card Company

1
Talk to your credit card company. Many credit cards will provide collision and theft/loss insurance in foreign countries—with no deductible—free of charge. As long as you use that card to rent the car, you’ll be covered. Just call your card company to get a detailed description of the coverage they provide. ^{[10]
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- Make sure you find out where the coverage applies (Italy and Ireland usually aren’t covered), what parts of the car are covered, the coverage limits, and how long the coverage lasts. ^{[11]
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2
Don’t rent a car that’s worth more than your coverage limits. If you rent a car that’s worth more than your coverage limits, you might be in for a rude awakening at the rental counter. That’s because the rental company will require you to purchase one of their CDWs to make up the loss.
- On top of everything, buying a CDW from a rental company might invalidate the coverage from your card company altogether. That means you’ll need to purchase even more coverage (CDW and super-CDW and loss/theft) to get the same protection you would have had through your credit card. ^{[14]
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- Just ask the rental company for the insured value of each car you’re considering before you reserve it.
3
Request a letter of coverage from your credit card company. A letter of coverage is a statement explaining the limits and nuances of the coverage you get from your card company. Although you should be covered with or without the letter, the letter of coverage will prove it to your rental company. ^{[16]
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- Your card company will typically cover any drivers listed on the rental agreement, but they have to be listed. Any increase in price from the rental company for extra drivers is probably worth the savings from not buying the insurance. Make sure the letter of coverage mentions this specifically, as a rental company could use its omission as a pretext to make you purchase coverage from them.
4
Bring along more than one credit card. If you use the insurance provided by your credit card company, the rental company may very well put a hold on your card for the value of the deductible, the value of the card, or up to your credit limit if that is lower. That means you might be maxed out on the card you use for the rental—hence the backup card for other purchases. ^{[17]
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- Some rental companies will decline to rent you a car if your credit limit is lower than the value of the car. If you get in this situation, look at cheaper cars or different rental companies before you use the rental car company’s coverage.
5
Seek reimbursement from the card company. If you do get into an accident, the rental company will charge your card for the full value of the damage—which is likely to be liberally estimated. You will then have to get reimbursement from the card company. ^{[19]
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- Make sure you get a copy of the police report from the local police and the rental company’s report of the accident. You’ll need them in order to document your claim.
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Method 3

Method 3 of 3:

Purchasing Rental Insurance from your Travel Insurer

1
Add rental coverage onto a travel insurance plan. Getting rental coverage through your travel insurer can be a great option between getting insurance through your rental company and getting insurance through your card. But the rental insurance is an add on, so you’ll need to purchase it along with a travel insurance plan. ^{[21]
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- There could be several reasons for not wanting to use your card company. Maybe your credit limit isn’t high enough, you don’t have another credit card, or you simply don’t want to deal with the hassle of getting reimbursed. Purchasing rental insurance through your travel insurer can be cheaper than going with the rental company, and easier than using a card company.
- Just remember to bring along a copy of your policy to the car rental agency.
2
Gather the necessary information. As you might expect, you’ll need to gather information about your trip, your companions, and your rental car. You will need: ^{[23]
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- The dates of travel (including travel while abroad). So if you travel to Europe and tour several countries, the insurer would need to know when you would be moving between each country.
- The destinations, including additional destinations while abroad. For example, if you were going on a road trip through Central America, which countries you planned on visiting.
- All of the names and dates of birth for anyone in your travel group.
- The total trip cost.
- The type of car you’ll be driving, how long you’ll be driving it, who will be driving it, and license information for all drivers.
3
Compare prices among insurers. Most travel insurance plans will offer coverage to reimburse for a cancelled or interrupted trip, return airfare, medical expenses, and lost baggage. The coverage limits will vary according to the insurer and what you’re willing to pay for. ^{[25]
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- There are a number of good travel insurers, including Travel Guard, Allianz Global Assistance, and Travelex. Many are affiliated with large general insurance companies. Make sure that you compare several brands. ^{[27]
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How to Get Car Insurance While Traveling Abroad

Steps

Buying Insurance from the Rental Car Company

Using Insurance from your Credit Card Company

Purchasing Rental Insurance from your Travel Insurer

Expert Q&A

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