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Canada’s best credit cards with auto rental insurance

Barry Choi, Personal Finance Contributer

Charlotte Sinclair, Personal Finance Contributor

May 27, 2025 | Fact checked by: Natasha Macmillan, Business Unit Director - Everyday Banking

Despite the peace of mind, paying for additional car rental insurance is almost always unnecessary. If you own a car and have insurance, your policy will usually cover you for car rentals. Even if you don’t own a car, there are many cash back credit cards and travel credit cards in Canada that provide you with both collision and damage coverage for rental vehicles. Here are our picks for the best credit cards for car rental insurance in Canada.

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The best credit cards for rental car insurance in Canada

BMO Ascend World Elite Mastercard

Featured

Best for Travel perks

First year reward
$809/yr

based on spending $2,200/mo after $150 annual fee

Earn rewards

1pt – 5pts / dollar spent

Welcome bonus

100,000 points (a $667 value)

Annual fee

$150

  • Rental car coverage: Damage or theft of your rental car plus any valid towing charges, lost or stolen personal effects, and accidental death and dismemberment
  • Coverage amount: A rental car with an MSRP of up to $65,000, and $500,000 for accidental death and dismemberment
  • Covered period: Up to 48 consecutive days
  • Conditions: You must use your card to pay for the full or partial cost of the rental vehicle and decline the rental agency’s damage waiver; claims must be made within 48 hours of an incident

In-depth: BMO Ascend World Elite Mastercard Travel Insurance

The BMO Ascend World Elite Mastercard offers coverage for up to $65,000 in damages. The insurance also provides accidental death and dismemberment benefits of up to $500,000 while occupying a rental car for one accident. This is quite extensive coverage compared to other cards.

Coverage extends to cars, sports utility vehicles, and vans as long as they’re for private use, seat no more than eight occupants, don’t exceed at “¾ ton” rating, and aren’t designed for recreational use.

American Express Cobalt Card

Featured

4.5 Ratehub rated

Best for Groceries & dining

First year reward
$643/yr

based on spending $2,200/mo after $156 annual fee

Earn rewards

1pt – 5pts / dollar spent

Welcome bonus

15,000 points (a $150 value)

Annual fee

$156

  • Rental car coverage: Damage, loss or theft of your rental car
  • Coverage amount: A rental car with an MSRP of up to $85,000
  • Coverage period: Rentals of 48 consecutive days or less
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver; claims must be made within 48 hours of an incident

The American Express Cobalt made our list of the best credit cards in Canada under the overall rewards cards category, but it also has some impressive travel benefits. Car Rental Theft and Damage Insurance is included as long as you fully charge your rental to your American Express Cobalt Card. You’re covered for damage or theft of your rental car with an MSRP of up to $85,000. 

Scotiabank Gold American Express Card

Featured

4.0 Ratehub rated

Best for Groceries & dining

First year reward
$1,186/yr

based on spending $2,200/mo after $120 annual fee

Earn rewards

1pt – 6pts / dollar spent

Welcome bonus

45,000 points (a $450 value)

Annual fee

$120

  • Rental Car Coverage: Covered up to the vehicle’s actual cash value plus any valid loss of use charges, towing charges, and administrative charges resulting from damage or theft
  • Coverage amount: Rental car with an MSRP of up to $65,000
  • Coverage period: Up to 48 consecutive days
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver

What’s great about the Scotiabank Gold American Express card is that it offers coverage up to the vehicle’s actual cash value plus loss of use charges, reasonable towing charges, and administrative charges that could result from damage or theft. The coverage extends to cars, sport utility vehicles, and minivans provided they seat no more than eight occupants including the driver, and they are used for private use only.

Scotiabank Passport Visa Infinite Card

Featured

4.0 Ratehub rated

Best for Travel perks

First year reward
$640/yr

based on spending $2,200/mo after $150 annual fee

Earn rewards

1pt – 3pts / dollar spent

Welcome bonus

30,000 points (a $300 value)

Annual fee

$150

  • Rental Car Coverage: Covered up to the vehicle’s actual cash value plus any valid loss of use charges, towing charges, and administrative charges resulting from damage or theft
  • Coverage amount: Rental car with an MSRP of up to $65,000
  • Coverage period: Up to 48 consecutive days
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver

The Scotiabank Passport Visa Infinite offers the same rental car insurance policy and coverage terms as the aforementioned Scotiabank Gold American Express Card for vehicles with an MSRP of $65,000. This card’s rental insurance policy extends to almost all car types – from four seater sedans to minivans – and covers up to the vehicle’s actual cash value plus loss of use charges, reasonable towing charges, and administrative charges that could result from damage or theft. It’s also worth highlighting that the Scotiabank Passport Visa Infinite offers from 5% up to 25% off the lowest available discountable retail rates at eligible AVIS locations and charges no foreign transaction fees (which can help you save further if you’re embarking on a road trip outside of Canada).

American Express Gold Rewards Card

Featured

4.0 Ratehub rated

Best for Groceries & gas

First year reward
$705/yr

based on spending $2,200/mo after $250 annual fee

Earn rewards

1pt – 2pts / dollar spent

Welcome bonus

60,000 points (a $600 value)

Annual fee

$250

  • Rental Car Insurance: Covers up to the vehicle’s actual cash value plus any valid loss of use charges resulting from damage or theft
  • Coverage amount: A rental car with an MSRP of up to $85,000
  • Coverage period: Up to 48 consecutive days
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver

The American Express Gold Rewards card offers similar coverage as the Scotiabank Gold American Express card in that they both offer full coverage up to the vehicle’s actual cash value plus any valid loss of use charges resulting from damage or theft. This card covers vehicles with a manufacturer’s suggested retail price of under $85,000 in its model year. This includes cars, sport utility vehicles, and minivans, provided they have a maximum gross vehicle weight of 2,680 kg (5,966 lbs.), seat no more than eight occupants, and are for private use only.

TD Cash Back Visa Infinite

Featured

Best for Household spending

First year reward
$1,355/yr

based on spending $2,200/mo after $139 annual fee

Earn rewards

1% – 3% / dollar spent

Welcome bonus

$600

Annual fee

$139 $0 first year waived

  • Rental Car Coverage: Covers up to the vehicle’s actual cash value plus any valid loss of use charges resulting from damage or theft
  • Coverage amount: Rental car with an MSRP of up to $65,000
  • Coverage period: Up to 48 consecutive days
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver

Along with offering 48 days of collision damage and loss insurance, the TD Cash Back Visa Infinite stands out for its strong earn rate of 3% cash back on gas. So, not only will you save on rental car insurance but at the pump too. Plus, you can knock an additional 5% to 10% off the base price when reserving a car from eligible Avis and Budget agency locations.

Honourable Mentions

While all our top choices highlighted above provide credit card rental coverage for up to 48 consecutive days, our list of honourable mentions below didn’t quite make the list because they offer coverage for 31 days. But, we thought they deserved a shoutout nonetheless because they’re great no fee credit cards that offer coverage despite the fact they’re free to carry.

Tangerine World Mastercard

Featured

4.5 Ratehub rated

Best for Flexible spending

First year reward
$617/yr

based on spending $2,200/mo after $0 annual fee

Earn rewards

0.5% – 10% / dollar spent

Welcome bonus

$100

Annual fee

$0

  • Rental Car Coverage: Covered up to the vehicle’s actual cash value plus any valid loss of use charges, towing charges, and administrative charges resulting from damage or theft
  • Coverage amount: Rental car with an MSRP of up to $65,000
  • Coverage period: Up to 31 consecutive days
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver

PC World Elite Mastercard

Featured

First year reward
$421/yr

based on spending $2,200/mo after $0 annual fee

Earn rewards

10pts – 45pts / dollar spent

Welcome bonus

20,000 points (a $20 value)

Annual fee

$0

  • Rental Car Coverage: Covered up to the vehicle’s actual cash value plus any valid loss of use charges, towing charges, and administrative charges resulting from damage or theft
  • Coverage amount: Rental car with an MSRP of up to $65,000
  • Coverage period: Up to 31 consecutive days
  • Conditions: You must use your card to pay the full cost of the rental vehicle and decline the rental agency’s damage waiver

FAQ

How do you use credit card insurance coverage for rental cars?


What does credit card car rental insurance cover?


What credit card should you use for car rentals?


Is a collision damage waiver the same as credit card rental car insurance?


Does roadside assistance apply to rental cars?


Our guide to credit card car rental insurance in Canada

Many credit cards in Canada include rental car insurance as a benefit — meaning you could decline the rental car insurance pushed by rental companies and save yourself hundreds of dollars. That said, you should know the terms of your credit card rental car insurance and what you need to do to qualify before assuming you’re covered in all scenarios.

What does credit card rental car insurance cover?

Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW): Most credit cards offer excellent collision and damage insurance that will cover you for the cost of the rental car in the event it’s stolen, vandalized, lost or damaged – even if an accident is your fault.

Theft protection: Suddenly find your parking spot is empty because someone broke into your car? In either of those cases, you’d be insured for the rental car (up to its MSRP) by your credit card.

Administrative/towing charges and Loss of Use: Some cards will cover the charges for towing a damaged vehicle or compensate the rental agency for the time that the rental car is out of service.

In general, making use of the insurance on your credit card will save you from having to buy the optional collision insurance or damage/loss waiver insurance from the rental agency (typically a cost of $16 to $23 per day) and still provide the coverage you need for the vehicle.

What credit card rental insurance won’t cover

While credit card car rental insurance will provide collision, damage, and loss coverage for the rental car itself, it won’t provide:

Third-party liability: Your credit card won’t cover you for any damage caused to someone else’s property or medical costs associated with an accident (like physiotherapy or other potential hospital bills).

Loss or theft of personal belongings: Outside of a few exceptions (like the BMO Ascend World Elite Mastercard), most credit cards also won’t  insure your personal effects. So, if your rental car is stolen and your expensive laptop along with it, you won’t get any money back for your laptop.

Generally, if you own a car and already have personal auto insurance, you’re probably covered for all the above and won’t need to pay out of pocket. But, if you don’t and you’re just relying on your credit card, you’ll only be covered for the cost of the rental car and you’ll need to purchase liability and personal injury insurance.

What to know before using your credit card for car rental insurance

Credit card rental car insurance, just like any insurance policy, has its fair share of fine print, terms, and legalese to decode. Even if your card comes with rental car insurance, you’ll need to check the fine print before you reserve your rental. Here are some of the most important things to know:

1. Is the car you’re renting eligible for coverage?

Some credit cards restrict rental car insurance to vehicles with a Manufacturer’s Suggested Retail Price (MSRP) below a certain amount, usually between $65,000-$80,000. If you’re renting a luxury car or a larger vehicle like a truck, it may not qualify for coverage.

2. How long is your car rental period?

Typically, credit cards will cover rental vehicles for a period of 31-48 consecutive days. If your rental exceeds the coverage period, you won’t be covered at all. 

3. Where are you renting the car?

Some countries such as Ireland, Israel, and Italy mandate that rental car insurance must be purchased locally, so your credit card’s insurance coverage may not apply — we’ll explain why in the next point. 

4. Does your credit card provide primary or secondary rental car coverage? 

Primary or secondary coverage determines what will be the first insurance to pay in the event of a claim. If the credit card provides primary car rental insurance, your personal auto insurance policy won’t be involved. However, if the credit card offers secondary coverage, you’ll need to file a claim with your personal insurance provider first. The credit card coverage will only apply to additional costs not covered by the personal policy.

That said, if your personal auto insurance policy isn’t valid overseas, the rental car insurance from your  credit card essentially becomes your primary coverage.

How to activate credit card rental car insurance

Most importantly, you must know that your credit card’s rental car insurance won’t apply automatically just because you are a cardholder. To activate auto rental insurance each time you rent a car, you must:

  1. Pay for the full price of the rental car using your credit card, and 
  2. Explicitly decline the collision/damage/loss waiver insurance from the rental agency.. 

In Australia, for instance, Collision Damage Waiver/Loss Damage Waiver (CDW/LDW) is included in the rental fee; customers must add a signed declaration declining CDW to the rental contract in order to use their credit card car rental insurance.

Limits to credit card car rental insurance

While credit card coverage usually applies around the world, that might not always be the case. Here are some other limitations: 

  • Your credit card must be in good standing, otherwise, coverage won’t apply.
  • Your credit card insurance won’t cover you in instances when you’re inebriated, carrying illegal goods, or visiting a country that has a travel warning in place.
  • Coverage is usually intended for rental cars that have been booked for personal use, and won’t apply if you’re using the rental for commercial purposes.
  • Credit card rental insurance will typically cover the primary cardholder as well as any driver who’s been given permission to use the vehicle by the primary cardholder.

Generally, if you’re renting a sedan or minivan just to get around or for a road trip out of the city, you’ll be covered through your card. To be extra safe, consider calling up your credit card company before reserving a rental car.

Last but not least, if you’re in the unfortunate situation where you have to make a claim, time will be of the essence as you’ll usually have to report a claim within 24 to 48 hours for it to be valid.

The bottom line

Regardless of which credit card you have, you can maximize your benefit from the car rental insurance provided. Before renting a vehicle, make sure that the rental agency will allow you to decline the collision damage waiver without making a deposit. Also check the rental car thoroughly for any scratches, dents, or damages before taking possession of the car. This will ensure you aren’t blamed for any damages prior to you taking possession of the vehicle.

Also read:

*This blog is for educational purposes only and isn’t legal advice. Check your credit card policy and rental car agency terms for details.