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Penfed amex car rental insurance

As I’ve discussed in the past, two valuable (but often overlooked) benefits of credit cards are travel insurance and secondary auto rental insurance, even though terms are sometimes poorly disclosed and policies can be inadequate. For instance, when you’re covered by secondary car rental insurance provided by your credit card and you damage a rental car in the US, you’ll still have to file a claim with your own car insurance company — something most drivers want to avoid like the plague. Fortunately, there are several credit cards on the market that offer primary car rental insurance, providing immediate and direct coverage to the driver of a rental car.

Parked car insurance icbcWhile most credit cards offer only secondary rental insurance, some provide primary coverage for greater peace of mind. Image courtesy of Shutterstock.

Car rental coverage provided by credit cards is called the Collision Damage Waiver (CDW). Secondary CDW coverage waives your rental car agency’s right to pursue you for damages incurred to your rental car as a result of theft, vandalism, etc. However, secondary coverage may come with a deductible (typically $500), and in most cases doesn’t cover administrative fees or total loss of the vehicle due to an accident. Secondary CDW coverage is offered by a variety of cards issued by American Express (e.g., the Premier Rewards Gold Card), Visa (e.g., Citi Hilton Honors Reserve) and Discover.

Primary rental car coverage provided by a credit card generally covers the loss of the vehicle, meaning you won’t need to pay a rental car company an extra fee for coverage when renting a vehicle, nor will you need to alert your car insurance company to any activity that could cause your premium to increase.

Most of these policies exclude certain countries from coverage — most commonly Australia, Ireland, Israel, Italy, Jamaica and New Zealand. All policies cover most private passenger automobiles, minivans and sport utility vehicles, but often don’t cover sport and specialty vehicles such as trucks, motorcycles, mopeds and motorbikes. Excluded across the board are cars considered antique (generally defined as any vehicle over 20 years old, or one that hasn’t been manufactured for 10 years or more) or exotic (e.g., Aston Martin, Porsche and Ferrari). In all cases, in order to receive primary car rental insurance via a credit card, you have to decline the rental agency’s CDW.

In addition, there are many credit cards out there that offer primary CDW insurance for rentals outside of the US. For example, when I log in to my Citi ThankYou Premier Card account and find the car rental insurance portion of my benefits, it specifically includes the following notation:

Ama online car insurance quoteCiti ThankYou cards only provide primary coverage outside the US.

You’ll want to read your card agreement very carefully before assuming that your rental is covered; a quick call to customer service should give you some additional insight into the details and exclusions of the policy.

The following credit cards presently offer primary auto insurance coverage on rentals both in the US and abroad (with countries of exception noted):

American Express Cards

All American Express cards offer premium primary coverage for a flat rate of $19.95 or $24.95 ($15.95 or $17.95 for California residents) for a rental period of up to 42 days (up to 30 days for Washington State residents). The more expensive option simply includes higher thresholds for medical expenses and coverage like accidental death and dismemberment. During the enrollment process, you’ll see details of the two options and can decide whether the extra coverage is worth the higher premium.

To enroll, simply visit the Amex Premium Car Rental Protection page and click Enroll Now. You’ll need to log in to your American Express account, choose the plan you’d like and review the program’s terms and conditions. You won’t be charged anything until you actually use an enrolled card to rent a car, in which case the premium will automatically post to your account. If coverage won’t be necessary for your travel needs, be sure to disenroll your card prior to your trip by calling 1-866-518-0259. Otherwise, you will automatically be charged on future rentals.

One of the best current offers is for The Platinum Card from American Express, which comes with 60,000 points after you spend $5,000 on purchases in the first three months. This card has a high $550 annual fee, but you can receive an annual airline fee credit of $200 for incidentals like checked bags, flight-change fees and snacks, and you’ll also pay no foreign transaction fees and enjoy complimentary lounge access.

Ink Plus Business Card, Ink Business Preferred Credit Card and Ink Business Cash Credit Card

These cards offer primary coverage for most types of vehicles (with the exception of sports cars, trucks and off-road vehicles) in most countries except Ireland, Israel and Jamaica. The coverage provides reimbursement up to the actual cash value of the vehicle for theft and collision damage. However, note that cardholders must be driving for business in order to be covered.

Ink Plus is no longer available to new cardholders, but existing holders earn 5 points per dollar spent at office supply stores and on cellular, landline, internet and cable TV services (on up to $50,000 in combined purchases each year). In addition, you’ll earn 2 points per dollar spent at gas stations and hotel stays (again, capped at $50,000 annually) and 1 point per dollar on all other purchases. The card incurs no foreign transaction fees, and there’s a $95 annual fee.

Ink Cash currently offers $300 cash back after you spend $3,000 in the first three months from account opening. You’ll earn 5% cash back per dollar spent at office supply stores and on cellular, landline, internet and cable TV services (up to $25,000 in combined purchases each year). In addition, you’ll earn 2% cash back per dollar spent at gas stations and restaurants (again capped at $25,000 annually) and 1% cash back on all other purchases. You can combine these earnings with other eligible Chase cards to essentially “convert” them to Ultimate Rewards points (in the same way you can with the Chase Freedom). Unfortunately, Ink Cash charges a 3% fee for foreign transactions, but there is no annual fee.

The recently introduced Ink Business Preferred Card is currently offering a sign-up bonus of 80,000 points after you spend $5,000 in the first three months. With this card, you’ll earn 3 points per dollar spent on travel, shipping purchases, internet/cable/phone and advertising purchases made with social media sites and search engines (on up to $150,000 in combined purchases each account anniversary year) and 1 point per dollar on everything else. This card has a $95 annual fee and doesn’t charge foreign transaction fees.

Be sure to check out Jason Steele’s post on choosing the right Chase Ink card for more information.

Chase Sapphire Preferred

Back in 2014, Chase announced some changes to the Sapphire Preferred, including a move from secondary to primary car insurance. Rentals of up to 31 consecutive days paid for with the card are covered for losses including physical damage and/or theft of the rental vehicle, valid loss-of-use charges assessed by the rental company and reasonable and customary towing charges related to a covered loss. Reimbursement is available up to the actual cash value of the vehicle as it was originally manufactured. While expensive or exotic cars are generally excluded, select models of BMW, Mercedes-Benz, Cadillac and Lincoln are covered.

The current sign-up bonus for this card is 50,000 points when you spend $4,000 on purchases in the first three months from account opening, and the $95 annual fee is waived the first year. This card earns you 2x points on travel and dining and doesn’t charge foreign transaction fees. It’s also a great pick since Ultimate Rewards points consistently appear near the top of my monthly valuations.

Diners Club Card Premier and Diners Club Card Elite

Do i need a title to buy car insuranceDiners Club offers two cards with primary rental insurance; unfortunately, neither card is available at the moment.

Both of these Diners Club cards provide primary coverage that applies to physical damage and theft of the vehicle, reasonable loss of use charges and reasonable towing charges, and includes secondary personal effects insurance. Protection for covered damages applies to rental cars with a retail price of up to $75,000.

Neither of these cards is available for new applications at the moment, so unless you’re already a cardholder, you’ll need to wait until they become publicly available again to take advantage of these benefits. The Elite card does offer triple points on purchases at grocery stores, drugstores and gas stations. Diners Club Rewards can be transferred to a wide variety of partners (including restaurants, airlines and hotels), and the card offers 24/7 personal concierge service, global airport lounge access and discounts on car rentals at Avis and Budget.

Discover Escape Card

While this card is no longer available to new applicants, existing cardholders can take advantage of its primary rental car insurance. Escape covers you for a rental period of up to 31 consecutive days, and excludes tax, gasoline and airport fees from its definition of car rental charges. The list of covered vehicles includes minivans and sport utility vehicles that hold up to 9 passengers, but excludes off-road vehicles and cars that have a suggested retail price above $50,000. Coverage includes physical damage to and theft of the vehicle, reasonable towing charges and any deductible or other eligible amounts not covered by other insurance. The insurance doesn’t cover personal injury, personal liability, damage to other vehicles or property or any injury to any other party.

Fairmont Visa Signature

This card doesn’t typically make the list of best hotel credit cards, but if your travels include Fairmont properties and you value primary CDW coverage, it can be a great option. The coverage is offered for physical damage and theft of most rented vehicles, up to 31 consecutive days within or outside your country of residence.

This is yet another card that’s not currently accepting new applications. Existing cardholders receive one complimentary night each anniversary year that they spend $12,000 on the card. You earn 5 Fairmont Rewards per dollar on Fairmont stays; 2 points per dollar spent on airline tickets purchased directly with airlines, at car rental agencies and on transit and commuting; and 1 point per dollar spent on all other purchases. The card incurs no foreign transaction fees and includes an automatic upgrade to Premier Status; you can also earn a stay credit toward Platinum Status by spending $7,500 on your card (up to 2 credits per calendar year). The $95 annual fee is waived for the first year.

The Ritz-Carlton Rewards Credit Card

Banger rally car insuranceThe Ritz-Carlton Rewards card offers primary coverage as well as valuable benefits at properties such as the Ritz-Carlson Seoul.

The primary coverage offered by this card protects you up to the actual cash value of most rental cars, and applies to damage caused by collision or theft.

The current sign-up bonus on this card is two complimentary nights at a Tier 1-4 property after you spend $4,000 on purchases in the first three months from account opening. You receive 5 points per dollar on Ritz-Carlton, Marriott and SPG purchases; 2 points per dollar on airline tickets, car rental expenses and restaurants; and 1 point per dollar on everything else. Additional benefits of this card are a $300 annual travel credit, a $100 hotel credit on paid Ritz-Carlton stays of two nights or more, complimentary Priority Pass Select membership, three upgrades to Ritz-Carlton Club Level each year and instant Gold Elite Status for the first year. The card incurs no foreign transaction fees, but comes with a $450 annual fee.

For more information, check out Richard Kerr’s review of the card from 2016.

United MileagePlus Explorer Card and United MileagePlus Club Card

Car insurance rates new zealandThese United cards can get you varying levels of access to United Club lounges.

These two Chase cards also offer primary coverage, and the insurance policy terms are almost identical to those offered by the Sapphire Preferred.

The current sign-up bonus on the Explorer card is 50,000 miles after you spend $3,000 on purchases in the first three months. You can enjoy priority boarding and a free checked bag when flying United, and you’ll also get two United Club passes every year. In addition, you’ll earn 2 miles per dollar spent on tickets purchased from United and 1 mile per dollar spent elsewhere. There is a $95 annual fee and the card incurs no foreign transaction fees.

The Club card gives you full United Club membership and automatic World of Hyatt Discoverist status. You’ll earn 2 miles per dollar on United purchases and 1.5 miles per dollar elsewhere. On United-operated flights, you’ll get your first and second checked bags free, and enjoy Premier Access for priority check-in and boarding. This card comes with a $450 annual fee, but you may be able to have the fee waived by signing up for the card in a Chase branch.

Other Options

Please note that many USAA co-branded cards (e.g., American Express, MasterCard, etc.) also offer primary rental car insurance to cardholders. However, these cards are only available to officers, enlisted personnel or veterans of the US military and their eligible family members.

Bottom Line

Many of us tend to focus on the earning and redeeming benefits of credit cards, especially when they come with lucrative sign-up bonuses. However, the other benefits can come in handy when traveling, and primary car rental coverage can be a lifesaver when you get into an accident. That being said, don’t assume that you’re covered for every possible auto-based mishap when you pay for a car rental with a card that offers primary coverage, as many exceptions and exclusions may apply. Before you rent a car, call your credit card’s customer service to determine exactly what is covered and what is not.

If you’ve taken advantage of primary car rental coverage provided through a credit card, please share your experiences (both positive and negative) in the comments below.

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Chase Sapphire Preferred® Card

With great travel benefits, 2x points on travel & dining and a 50,000 point sign up bonus, the Chase Sapphire Preferred is a great card for those looking to get into the points and miles game. Here are the top 5 reasons it should be in your wallet.

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  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®
  • Named Best Credit Card for Flexible Travel Redemption - Kiplinger's Personal Finance, July 2016
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • Earn 5,000 bonus points after you add the first authorized user and make a purchase in the first 3 months from account opening
  • No foreign transaction fees
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 50,000 points are worth $625 toward travel
  • No blackout dates or travel restrictions - as long as there's a seat on the flight, you can book it through Chase Ultimate Rewards
Intro APR on Purchases N/A Regular APR 16.74% - 23.74% Variable Annual Fee Introductory Annual Fee of $0 the first year, then $95 Balance Transfer Fee Either $5 or 5% of the amount of each transfer, whichever is greater. Recommended Credit Excellent Credit

Editorial Disclaimer: Opinions expressed here are author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

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Disclosure: We get a commission for links on the blog. You don’t have to use our links, but we’re very grateful when you do. American Express, Barclaycard, Chase, and US Bank are Million Mile Secrets advertising partners. Opinions expressed here are the author's alone, and have not been reviewed, approved or endorsed by our partners. Here’s our Advertiser Disclosure.

Rental car companies charge more for drivers who are under the age of 25 than those over the age of 25.  And drivers under 21 years find it very hard to rent cars by themselves.  Blame it on the statistics!

Statistics show that drivers under the age of 25 have more accidents.  So car rental companies charge more for drivers 25 years or younger.  You also have to be at least 21 years to rent a car from most companies, except in Michigan and New York where state law bans this practice.

Josef meijer sainsbury's car insurance

She’s Happy Because She Didn’t Pay Extra Fees For Renting a Car!

But young drivers pay for the privilege of renting a car by paying surcharges ranging from $14 to $73 a day!

Using the USAA discount code is the secret to getting low prices for car rentals for underage drivers and to rent a car if you’re between 18 to 25 years old.

The USAA discount code also waives additional driver fees so it could be useful for folks who aren’t below 25 years as well!

Cheap Car Rentals Series:

  • Part 1 – Finding The MOST You Should Pay With Hotwire & Costco Travel
  • Part 2 – Save Hundreds of Dollars by Using the Chase Ultimate Rewards or Citi Thank You Portal!
  • Part 3 – Saving Money With the Capital One Travel Portal
  • Part 4 – Southwest Airlines’ Car Rentals
  • Part 5 – National Car Rental’s “Last Minute Specials”
  • Part 6 – Priceline’s “Name Your Own Price”
  • Part 7 – 5 Ways to Add an Additional Driver for Free
  • Part 8 – Let Autoslash Do The Work
  • Part 9 – American Airlines Car Rentals
  • Part 10 – Why Everyone Should Sign Up For Frequent Car Rental Programs
  • Part 11 – Save More With Car Rental Savers
  • Part 12 – How To Get The Best Rates For Drivers Under 25 Years
  • Using Airline Miles for Car Rentals
  • Using Hertz Coupons & Discounts
  • Using Airline Discount Codes & Earning Miles for Rentals

Young Driver Surcharge Fees

Drivers between the ages of 21 to 24, can rent from Advantage, Avis, Budget, Dollar, Enterprise, Hertz, National, and Thrifty by paying a $14 to $73 extra fee per day.  US government or military personnel traveling on official business are exempt from young driver surcharges.

Some car rental companies have restrictions on the types of cars which folks under 25 years can rent.  Here’s a table outlining all the fees and restrictions if you didn’t read Million Mile Secrets and know how to get around them!

AlamoAvisBudgetDollarEnterpriseHertzNational Thrify
Minimum Rental Age21 Years21 Years21 Years21 Years21 Years20 Years (21 years in Mississippi)21 Years21 Years
Vehicle Rental RestrictionsNoneNo full-size & premium SUVs, Minivans, Passenger vans, Signature SeriesNo luxury cars, minivan, passenger vans, speciality vehicle, full-size & premium SUVsVaries depending on locationNoneNo Prestige Collection or no Adrenaline Collection carsVaries depending on locationNo premium, luxury, SUV, speciality, minivan, van, wagon, convertible, or pickup
Young Driver Daily Surcharge under 25$25$27 $27Varies depending on location$20+$15$25Varies depending on location
Michigan Daily Surcharge (18 to 20 years old)$26$41$41 (corporate locations only)Varies depending on location$26$20 to $41$26Doesn't indicate
Michigan Daily Surcharge (21 to 24 years old)$14$28$28 (corporate locations)Varies depending on location$14$20 to $25$14Doesn't indicate
New York Daily Surcharge (18 to 20 years old)$66$52$52 (corporate locations)Varies depending on location$66$20 to $41$66$73
New York Daily Surcharge (21 to 24 years old)$24$35$35 (corporate locations)Varies depending on location$24$20 to $25$24$35

I don’t like how vague Dollar and Thrifty are about their underage driver fees.  I would avoid renting from them because I’d want to know approximately how much I would pay before getting to the rental counter.

As you can see from the table, Hertz allows drivers as young as 20 to 21 to rent cars, allows for more car choices, and offers the lowest underage driver fees.

Comparing Underage Rental Car Surcharges

Here’s a table comparing rental rates for drivers 25 years or older and drivers under 25 renting an economy car in Charleston from September 6, 2013 to September 8, 2013.

I tested rates for the ages of 20, 21, and 24 & the underage driver rates were the same.  It didn’t matter how underage you were or how close to the age of 25 you were.  You still had to pay the fee.

2 Day Weekend Rental, Charleston, September 2013Over 25 YearsUnder 25 Years
Budget$157$224
CarRentalSavers$85(No option to indicate age.)
Costco$87$219*
Hertz$221$259
Ultimate Rewards Mall$79(No option to indicate age.)
USAA$50$50**

CarRentalSavers and Ultimate Rewards  don’t let you specify your age when you make a booking, so an underage driver might be surprised when the bill at the counter is more than the rate shown online.

*Underage drivers using CostcoTravel have to call Costco and are transferred to either Avis, Budget, Dollar, or Enterprise.  The agent confirms your Costco membership number and quotes you a price.

**There are no young driver fees when renting from Avis, Budget, Enterprise, or Hertz for USAA members.

Budget

Let’s see how much extra an underage driver would pay.

A driver 25 years or older renting an economy car from Budget for a weekend in Charleston would pay $157.

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Over 25 Driver Pays $157 For A Weekend Rental From Budget

Underage drivers would pay $224 or $67 more dollars!

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But an Underage Driver Pays $224 For the Same Rental From Budget

Costco

Drivers above 25 years pay $87 for an economy car for a weekend in Charleston.

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Over 25 Drivers Pay $87 For A Weekend Rental Through Costco

While younger drivers must call 877-849-2730, select from Avis, Budget, Dollar, or Enterprise, confirm their Costco membership, and get a quote.  The phone call can take a long time.  It took almost 30 minutes for Budget to give me my quote.

Rates vary depending on the underage driver surcharge assessed by each company and rental location.

Car insurance commercials

Under 25 Drivers Pay $219 Or More For A Weekend Rental From Costco

USAA

The best way to reduce costs for folks under 25 is to sign-up for USAA membership (it is free).

Using the USAA discount code waives young driver fees when renting from Avis, Budget, Enterprise and Hertz so an underage driver would only pay $50.

Travelers car insurance customer service number

Under 25 Year Old Drivers Pay Much Less ($50) For A Weekend Rental From USAA

1.   Use USAA TO SAVE MONEY FOR UNDERAGE DRIVERS

Link:   USAA.com

USAA is a Fortune 500 company which provides banking, financial services and other discounts to the military and their families.  Anyone can join USAA and you don’t need to be associated with the military to join and receive certain discounts.

However, USAA restricts certain products and services only to members with military affiliation.  USAA members who’ve served longer may get better offers and discounts.

The good news is that USAA discounts for car rentals are available to anyone!

“Our investment products, most checking and savings products, credit cards, life insurance, and shopping and discounts are available to other individuals.”

Least expensive cars to insure for teenage drivers

You Don’t Have to be in The Military to Get Car Rental Discounts From USAA!

You can join USAA by calling 800-531-8722 or by registering online.

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USAA Member Discounts On Shopping, Home Security, Cars, And Travel

Here’s another example of the low car rental rates using USAA, this time using a different city and a different rental car company.

A driver under 25 would only pay $67 through USAA for a rental in Providence.

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Driver Under 25 Years Pays $67 For A Weekend Rental From USAA

But that same driver would pay $271 – or $202 more – without the USAA discount!

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Under 25 Driver Pays $202 More For The Same Rental Without USAA Discount!

Note that if you’re between 18 & 20 years old you can use only the USAA discount code for Hertz.  The discount codes for Avis, Budget and Enterprise require you to be at least 21 years old.

Other Benefits of USAA

The USAA discount code also gets you these benefits:

  • Discounts of up to 25% off Avis or Hertz and 20% off Budget and Enterprise
  • No additional driver fees for spouses and USAA members
  • Primary liability coverage.  Coverage with some rental car companies is limited to the state minimum coverage, though.

How To Use USAA To Rent Cars

Step 1 – Log In To Your USAA Account

Enter your Online ID and password to log on to your USAA account.

Which state does not require car insurance

Step 1 – Log Into Your USAA Account

Step 2 – Enter Your PIN

USAA is big on security (no surprise) so this is the first of two security steps!

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Step 2 – Add Your PIN

Step 3 – Answer Your Security Question

Answer your security question.

The different car insurance groups

Step 3 – Answer A Security Question

Step 4 – Click On “Our Products” Menu

Click on the “Our Products” dropdown menu.

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Step 4 – Click On “Our Products” in the top Left Part of the Screen

Step 5 – Select “Travel Discounts”

Click on “Travel Discounts” in the menu under “Shopping and Discounts” on the right of the page.

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Step 5 – Click On “Travel Discounts”

Step 6 – Scroll Down To Rental Car Discounts

Scroll down to the rental car discounts section and click on “Learn More”

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Step 6 – Click On “Learn More”

Step 7 – Choose A Rental Car Company

You can choose either Avis, Budget, Enterprise or Hertz and you will be redirected to rental car company to look up prices.  The USAA discount code will be automatically applied to your reservation.

There is no way to see the discounted rates for all four companies at the same time.  You have to search each rental car company one-by-one to find the best price.

Note that if you’re between 18 & 20 years you can use only the USAA discount code for Hertz.  The discount codes for Avis, Budget and Enterprise require you to be at least 21 years old.

2.   Use Corporate Discounts to Save Money for Underage Drivers

If you work for a corporation, you may be able to use your corporate discount for personal rentals and have the underage fees waived.  But this varies based on your employer, so check with your corporate travel department.

3.   Local Car Rental Agencies

Look for local car rental agencies in your college town which rent cars to students.  They usually will rent to folks below 25 years old and may have cheaper fees if you’re under 25 years old.

Bottom Line

Car rental companies charge high fees for rivers under the age of 25.

The minimum age to rent a car is 21, except in Michigan and New York where the minimum age required by law is 18.  US government and military personnel do not have to pay underage fees when renting cars on official government business.

But you can save LOTS of money by joining USAA and using their discounted rate for car rentals.

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Disclosure: We get a commission for links on the blog. You don’t have to use our links, but we’re very grateful when you do. American Express, Barclaycard, Chase, and US Bank are Million Mile Secrets advertising partners. Opinions expressed here are the author's alone, and have not been reviewed, approved or endorsed by our partners. Here’s our Advertiser Disclosure.

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Sometimes you need a 1-way car rental where you pick-up the car at one location (say Los Angeles), but return the car to a different location (say San Francisco).  But 1-way rentals cost a lot more than regular rentals.

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One Way Rentals Can Cost A Lot of Money!

Cheap Car Rentals Series:

  • Part 1 – Finding The MOST You Should Pay With Hotwire & Costco Travel
  • Part 2 – Save Hundreds of Dollars by Using the Chase Ultimate Rewards or Citi Thank You Portal!
  • Part 3 – Saving Money With the Capital One Travel Portal
  • Part 4 – Southwest Airlines’ Car Rentals
  • Part 5 – National Car Rental’s “Last Minute Specials”
  • Part 6 – Priceline’s “Name Your Own Price”
  • Part 7 – 5 Ways to Add an Additional Driver for Free
  • Part 8 – Let Autoslash Do The Work
  • Part 9 – American Airlines Car Rentals
  • Part 10 – Why Everyone Should Sign Up For Frequent Car Rental Programs
  • Part 11 – Save More With Car Rental Savers
  • Part 12 – Do You Know How To Get The Lowest Price For Drivers Under 25 Years Old?
  • Part 13 – One Way Rentals
  • Using Airline Miles for Car Rentals
  • Using Hertz Coupons & Discounts
  • Using Airline Discount Codes & Earning Miles for Rentals

Fees

Most rental car companies charge a drop-off fee when you pick up a vehicle from one location and return it at another.

Alamo charges both a drop-off fee and a mileage charge which they call an “inter-city” fee.  Alamo’s drop-off fee varies by location and time of year, so you could pay more if you drop off in one city than another or if you drop the car off during the holidays.

Rental car companies are very sneaky about fees, so always compare the TOTAL cost of a rental after all fees/charges/surcharges are added.

1-WAY RENTALS COST MORE

1-way rentals are more expensive than roundtrip rentals.

When you rent a car for only 1-way, the rental car company has to get the car back to its original location so they pass on these costs to you.

For example, you will pay $1,034 for a 1-way rental from San Diego to Salt Lake City from April 11, 2014 to April 16, 2014.

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$1,034 For A Rental From San Diego To Salt Lake City

But the same rental picked up and returned at Salt Lake City only costs $354!  That’s $680 MORE ($1,034 for a 1-way rental – $354 for a same city rental)  for dropping off the car elsewhere.

European car insurance comparison

Picking Up And Returning To The Same City Is $680 Cheaper!

Not All Companies Allow 1 Way Rentals

Most rental companies allow 1-way rentals, but they may not be available from all locations so you need to check before renting.

Alamo does not allow international 1 way rentals while Enterprise only allows 1-way rentals from select locations.

Finding Cheap 1 Way Rentals

You can book inexpensive 1-way rentals through Costco Travel, Car Rental Savers, and the Capital One portal.  Unfortunately, you can’t book 1-way rentals through the Ultimate Rewards portal which often has the best rental deals.

I find that Capital One usually has the lowest 1-way rentals, but that is not always the case, so you should check the rate on different sites.

I compared 1-way rental rates using Capital One, Car Rental Savers, Costco Travel, Hotwire, and USAA.

A)   1 week rental from Los Angeles to San Francisco

I checked the prices for a 1-Way Rental From Los Angeles to San Francisco from January 5, 2014 to January 12, 2014.  This is a fairly common rental route because folks drive down the Pacific Highway.

Capital OneCar Rental SaversCostcoHotwireUSAA
1-Way Weekly Rental From Los Angeles to San Francisco $310$317$342$316$377

The Capital One portal had the cheapest rate of $310, but Hotwire was only $6 more!  So you’d be able to get a good price even if you didn’t have a Capital One card.

Purchase insurance before car

1-Way Rental From Los Angeles To San Francisco For $316 on Hotwire

B)   4 day rental from Kansas City to Austin

I also checked the rate of a more unusual 1-way rental route, which often have high prices.  Sure enough, this 4-day rental from February 14, 2014, to February 18, 2014  was VERY expensive!

Capital One Car Rental SaversCostcoHotwireUSAA
4 -Day 1-Way Rental From Kansas City to Austin $942$560$802$560$592

The cheapest rate was $560 on Hotwire, which is a lot for a 4-day rental!  And in this case, the Capital One portal was $400 more so you should shop around for the best deal.

1.  Splitting Up A Rental

You can save money on 1-way rentals, by splitting your rental into 2 separate rentals.  This usually saves money on the unusual 1-way rental routes.

But make sure to factor in the “hassle factor” of returning the car to the airport and picking up a new rental car.

A)  Los Angeles To San Francisco

Instead of doing a 1-way weekly rental from Los Angeles to San Francisco, I checked to see if it would be cheaper to split the rental.  I would make 2 separate rental car bookings:

  • 6 days in Los Angeles and
  • A 1 day 1-way rental from Los Angeles to San Francisco

I would rent the car for 6 days from the Los Angeles airport and then return the car to the Los Angeles airport and rent another car for just the 1-day drive to San Francisco.

Capital One (Thrifty)Car Rental SaversCostcoHotwireUSAA (Avis & Budget)
6 Day Rental Los Angeles
Jan 5 to 11, 2014
$146$196$274$271$200
1 Way Rental Los Angeles to San Francisco Jan 11 to 12, 2014$45$95$93$95$102
Total Cost$191$291$367$366$302

It was cheaper to book two separate rentals when booking through Capital One, Car Rental Savers, and USAA.  However, you should see if the savings is worth the extra time to drive the car back to the airport and pick-up another rental.

Capital One (Budget & Thrifty)Car Rental SaversCostcoHotwireUSAA (Budget & Avis)
1 Way Weekly Rental Los Angeles to San Francisco January 5 to 12, 2014$310$317$342$316$377
6 Day Rental Los Angeles
Jan 5 to 11, 2014 + 1 Way Rental Los Angeles to San Francisco Jan 11 to 12, 2014
$191$291$367$366$302
Savings$119$26$-25 (Split rental will cost you more.)$-50 (Split rental will cost you more.)$75

By splitting the rental into two separate rentals, you’d save:

  • $119 with Capital One ($310 – $191)
  • $26 with Car Rental Savers ($317 – $291)
  • $75 with USAA ($377 – $302)

B.  Kansas City To Austin

Instead of doing a 4-day rental from Kansas City to Austin, I checked to see if it would be cheaper to split the rental.  I would make 2 separate rental car bookings:

  • 3 days in Kansas City and
  • A 1 day 1-way rental from Kansas City to Austin

I would rent the car for 3 days from the Kansas City airport and then return the car to the Kansas City airport and rent another car for just the 1-day drive to Austin.

Capital One (Thrifty & Alamo)Car Rental SaversCostcoHotwireUSAA (Avis & Enterprise)
3 Day Rental Kansas City
Feb 14 to 17, 2014
$84$108$94$80$104
1 Way Rental Kansas City to Austin Feb 17 to 18, 2014$236$200$200$248$236
Total Cost$320$308$294$328$340

It was SIGNIFICANTLY cheaper to book two separate rentals for this unusual rental car route.

Capital One (Alamo & Thrifty)Car Rental SaversCostcoHotwireUSAA (Hertz, Avis & Enterprise)
4 Day 1 Way Rental Kansas City to Austin February 14 to 18, 2014$942$560$802$560$592
3 Day Rental Kansas City
Feb 14 to 17, 2014 + 1 Way Rental Kansas City to Austin Feb 17 to 18, 2014
$320$308$294$328$340
Savings$622$252$508$232$252

By splitting the rental into two separate rentals, you’d save:

  • $622 with Capital One ($942 – $320)
  • $252 with Car Rental Savers ($560 – $308)
  • $508 with Costco ($802 – $294)
  • $232 with Hotwire ($560 – $328)
  • $252 with USAA ($592 – $340)

If you booked a one way rental from Kansas City to Austin on February 14 to 18, 2014, it would cost $802.

Go compare car insurance reviews

Costco Charges $802 For A One Way Rental From Kansas City To Austin

But if you split the rental into two separate rentals, it would only cost $294.

Rental One – 3 day rental in Kansas City from February 14 to 17, 2014 costs $94.

Band d car insurance

$94 For A 3 Day Rental In Kansas City

Rental Two – 1 day rental from Kansas City to Austin on February 17 to 18, 2014 is $200.

Safe auto car insurance phone number

$200 For A One Way Rental From Kansas City To Austin

In general, unusual city combinations, such as Kansas City to Austin in my example, will be cheaper when you book two separate rentals.

2.   Using Points

Using car rental program points for 1-way rentals will save you a lot of money.  However, you likely won’t be eligible to use the car insurance from your credit card, so do the math to see if it makes sense for you.

Insurance ratings cars

Use Hertz Points to Save on 1-Way Car Rentals

For example, it costs 5,000 Hertz points for a 1 week 1-way rental.  You can usually buy Hertz points at a discount during the Discover America promotion at the start of summer.

If you frequently rent cars for 1-way trips, it is better to collect points in the car rental program instead of having your rental earn airline miles via the car rental program.

3.  Seasonal Specials

You can take advantage of cheap 1 way rentals from Hertz during the Spring and Fall for selected destinations such as Arizona and Florida.  Other rental car companies also offer similar promotions before and after summer or when they need to move cars from one state to another.

4.  Driveaways

Link:  Auto Driveaway

Link:  Go Nomad

Link:  CarsDirect

This isn’t really an option for most folks because the driveaway routes may not be the routes you want to drive!

Driveaway companies such as Auto Driveaway,  Go Nomad, and CarsDirect specialize in vehicle relocation and let you drive cars for free from 1 state to another.

Each company has different requirements to participate but in general you need:

  • To be at least 25 years old
  • Have a good driving record
  • Pay an upfront deposit
  • Pay for the gas

You also have a deadline, route and mileage restriction.  So keep that in mind before you sign on to do a driveaway.

Bottom Line

1-way rentals are more expensive than roundtrip rentals.  I usually search the Capital One portal, Car Rental Savers, and Costco Travel to find cheap 1-way rentals.

Splitting up a one way car rental into two separate rentals can be much cheaper than booking a single one way car rental – especially for unusual routes.

PS:  I’m on vacation so I won’t be able to get to the comments soon.

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* If you liked this post, why don’t you join the 25,000+ readers who have signed-up to receive free blog posts via email (only 1 email per day!) or in an RSS reader …because then you’ll never miss another update!

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