Collision Damage Waiver: What is it? (2024)

Katie Powers
Written byKatie Powers
Photo of an Insurify author
Katie PowersAuto and Life Insurance Editor
  • Licensed auto and home insurance agent

  • 3+ years experience in insurance and personal finance editing

Katie uses her knowledge and expertise as a licensed property and casualty agent in Massachusetts to help readers understand the complexities of insurance shopping.

Featured in

media logomedia logo
Jackie Cohen
Edited byJackie Cohen
Photo of an Insurify author
Jackie CohenEditorial Manager

Jackie Cohen is an editorial manager at Insurify specializing in property & casualty insurance educational content. She has years of experience analyzing insurance trends and helping consumers better understand their insurance coverage to make informed decisions about their finances.

Jackie's work has been cited in USA Today, The Balance, and The Washington Times.

Konstantin Halachev
Data reviewed byKonstantin Halachev
Headshot of Konstantin Halachev, VP of Engineering at Insurify
Konstantin HalachevVice President of Engineering
  • 7+ years experience in data analysis

  • Ph.D. in Computational Biology

Konstantin has led data teams across multiple industries, including insurance, travel, and biology. He’s led Insurify’s engineering team for more than three years.

Updated June 15, 2022 at 12:00 PM PDT

Advertiser Disclosure

At Insurify, our goal is to help customers compare insurance products and find the best policy for them. We strive to provide open, honest, and unbiased information about the insurance products and services we review. Our hard-working team of data analysts, insurance experts, insurance agents, editors and writers, has put in thousands of hours of research to create the content found on our site.

We do receive compensation when a sale or referral occurs from many of the insurance providers and marketing partners on our site. That may impact which products we display and where they appear on our site. But it does not influence our meticulously researched editorial content, what we write about, or any reviews or recommendations we may make. We do not guarantee favorable reviews or any coverage at all in exchange for compensation.

Why you can trust Insurify: Comparing accurate insurance quotes should never put you at risk of spam. We earn an agent commission only if you buy a policy based on our quotes. Our editorial team follows a rigorous set of editorial standards and operates independently from our insurance partners. Learn more.

Collision damage waivers come into play to provide some element of insurance coverage for rental vehicles. At the time of an auto rental, the rental car company will likely offer the customer a collision damage waiver add-on aimed to provide theft and damage insurance for the renter. This waiver typically comes with an additional cost, making it important to consider all options.

Whether you’re renting a car for a vacation or business trip or driving your own car, an affordable car insurance policy is a must. Insurify’s handy quote-comparison tool allows auto insurance customers to compare monthly quotes from dozens of the nation’s top auto insurance providers. Discover personalized auto insurance policy quotes at an affordable price today.

Quick Facts
  • A collision damage waiver is an add-on service available for rental vehicle customers.

  • Drivers with clean driving records typically pay less for their personal auto insurance.

  • Many insurance companies offer savings for customers who bundle insurance policies.

What is a collision damage waiver?

What is a collision damage waiver?

CDWs are optional coverage which provides protection to drivers of rental cars.

An optional service from rental car companies, the collision damage waiver (or CDW) completed during the rental agreement process provides coverage for the renter in the event of physical damage to their rental vehicle due to a car accident, vandalism, or theft. If damage does occur, renters within the United States with the waiver do not pay for repair fees or a deductible.

Some companies use the terms loss-of-use coverage or loss damage waiver (LDW)—referring to coverage while a car is repaired—interchangeably with the term collision damage waiver. Liability insurance related to damages to other vehicles or bodily injury medical costs is not included under the collision damage waiver, which only covers damages to the rental car.

Best Car Insurance Companies

Best Car Insurance Companies

How much does a collision damage waiver cost?

Collision damage waivers vary in cost depending on a number of factors, including the rental company, the rental vehicle, and the plan for where the rental car will be driven. These waivers will increase in cost when the perceived possibility of vehicle damage increases. For example, companies will charge more for a waiver if a fancy sports car is rented and driven around a high-traffic area.

Collision Damage Waiver Estimated Costs by Company

Most car rental agencies calculate costs for collision damage waivers based on the specific auto rental and rental period. Before purchasing a collision damage waiver, be sure to review your existing insurance plan because you may already have rental car insurance coverage. Estimated costs from some of the top rental companies are available in the list below.

  • Enterprise: Coverage ranges from $10 to $20 per day, according to various online sources.

  • Alamo: Coverage ranges from $9 to $26.99, according to various online sources. For California drivers, costs range from $10.99 to $500 per day.

  • Hertz: The collision damage waiver costs $45 per day, no matter what kind of vehicle you’re renting.

  • Avis: The company advertises costs as low as $9 per day.

  • U-Haul: The collision damage waiver from the company only applies to smaller pickup trucks and vans. The waiver lays out a $150 deductible for the majority of accidental damage.

Credit Card Companies Offering Collision Damage Waivers

As a further incentive to their customers, many credit card companies provide a collision damage waiver for individuals who pay for their rental vehicle with their credit card. Even if your existing insurance plan provides coverage for a collision damage waiver, the extra offering from your credit card company can be supplemental. Find credit card coverage specifics listed below.

  • Chase: Chase Sapphire Preferred cardholders earn coverage for themselves and any additional drivers added to the rental agreement. The waiver covers any physical damage to or theft of the rental vehicle, as well as any towing charges or loss-of-use costs.

  • Visa: To earn a collision damage waiver from Visa, the cardholder simply needs to complete the rental car payment with their Visa credit card and not purchase the rental company’s waiver. Visa then covers any vehicle damage related to collision or theft.

  • Mastercard: The MasterRental program provides coverage for physical damage, loss-of-use costs, and any towing fees related to the rental vehicle. This applies as long as the vehicle’s MSRP (manufacturer’s suggested retail price) falls below $50,000.

  • Bank of America: The company’s credit cards all provide their cardholders with rental car benefits. The supplemental damage waiver adds to your existing car insurance and provides reimbursement in the event of vehicle damage from collision or theft.

  • American Express: Unlike most credit card companies, American Express provides some liability coverage (up to $5,000) to pay for rental car damage and medical expenses. To activate this coverage, American Express Platinum cardholders simply have to pay for the rental car with their credit card.

Cheap Car Insurance

Cheap Car Insurance

Compare Car Insurance Quotes Instantly

Secure. Free. Easy-to-use.
Based on 3,806+ reviews
4.8/5
Shopper Approved
ProgressiveLiberty MutualTravelers

Do I need a collision damage waiver if I have car insurance?

Purchasing a collision damage waiver for those with existing car insurance may not be needed if they have collision coverage and comprehensive coverage. Those with high deductibles or lackluster coverage should consider paying for a collision damage waiver.

Rental car drivers traveling out of the country to Canada or elsewhere may face exclusions from their existing insurance coverage that make purchasing a waiver worthwhile. Some policies do not transfer to another country, making separate rental coverage a necessity. Furthermore, purchasing a waiver can give peace of mind to those worried about increasing insurance rates.

Best and Worst Sites to Compare Car Insurance

Best and Worst Sites to Compare Car Insurance

How to Find Cheap Auto Insurance in Minutes

While purchasing the collision damage waiver add-on is important for some individuals renting a vehicle, existing car or travel car insurance coverage and coverage from various credit card companies may make it unnecessary. Having comprehensive coverage and collision coverage makes the process of shopping for a rental vehicle easier and more affordable for authorized drivers.

Shopping around for affordable car insurance policies increases an individual’s chances of finding the most affordable insurance rates that best meet their specialized car insurance needs. With the help of Insurify’s car insurance quote-comparison tool, users compare monthly quotes from dozens of the nation’s top car insurance providers in just a matter of minutes.

Frequently Asked Questions

  • What is a collision damage waiver?

    A collision damage waiver, sometimes referred to as a loss damage waiver, is an optional add-on from rental car companies. In the event of a car accident or theft resulting in physical damage to the rental vehicle, the waiver covers the associated fees for the vehicle renter. This coverage may also be included in existing insurance plans or by various credit card companies.

  • Who needs a collision damage waiver?

    Collision damage waivers make the most sense for uninsured and underinsured drivers, renters driving in countries besides the United States, and people concerned about increasing the insurance rates of their existing insurance policies. Drivers with comprehensive insurance coverage and collision coverage typically do not need to purchase the supplemental add-on.

  • Are collision damage waivers expensive?

    Collision damage waivers vary in cost depending on the rental company, rental vehicle, and intended driving plan for the rental period. On the lower end of the cost spectrum, drivers can purchase a collision damage waiver for their rental for as little as $9 to $20 per day. Prices tend to increase for drivers renting an expensive car or driving in a high-traffic or high-crime area.

  • How can I find cheap car insurance?

    Finding cheap car insurance that meets your specialized insurance needs requires some time spent shopping around for the lowest rates. The Insurify car insurance quote-comparison tool allows users to easily compare monthly quotes from dozens of the nation’s top car insurance providers. Try it out for yourself today, and discover how you can save big!

Compare Car Insurance Quotes Instantly

Secure. Free. Easy-to-use.
Based on 3,806+ reviews
4.8/5
Shopper Approved
ProgressiveLiberty MutualTravelers

Methodology

Insurify data scientists analyzed more than 90 million quotes served to car insurance applicants in Insurify’s proprietary database to calculate the premium averages displayed on this page. These premiums are real quotes that come directly from Insurify’s 50+ partner insurance companies in all 50 states and Washington, D.C. Quote averages represent the median price for a quote across the given coverage level, driver subset, and geographic area.

Unless otherwise specified, quoted rates reflect the average cost for drivers between 20 and 70 years old with a clean driving record and average or better credit (a credit score of 600 or higher).

Liability-only premium averages correspond to policies with the following coverage limits:

  • Bodily injury limits between state-minimum rates and $50,000 per person, $100,000 per accident
  • Property damage limits between $10,000 and $50,000
  • No additional coverage
Full-coverage premium averages correspond to the same bodily injury and property damage limits in addition to:
  • Comprehensive coverage with a $1,000 deductible
  • Collision coverage with a $1,000 deductible

Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates.

Katie Powers
Katie PowersAuto and Life Insurance Editor

Katie Powers is an insurance writer at Insurify with a producer’s license for property and casualty insurance in Massachusetts and expertise in personal finance and auto insurance topics. She strives to help consumers make better financial decisions. Prior to joining Insurify, she completed her undergraduate and graduate degrees at Emerson College. Her work has been published in St. Louis Magazine, the Boston Globe, and elsewhere. Connect with Katie on LinkedIn.

Jackie Cohen
Edited byJackie CohenEditorial Manager
Photo of an Insurify author
Jackie CohenEditorial Manager

Jackie Cohen is an editorial manager at Insurify specializing in property & casualty insurance educational content. She has years of experience analyzing insurance trends and helping consumers better understand their insurance coverage to make informed decisions about their finances.

Jackie's work has been cited in USA Today, The Balance, and The Washington Times.

Konstantin Halachev
Data reviewed byKonstantin HalachevVice President of Engineering
Headshot of Konstantin Halachev, VP of Engineering at Insurify
Konstantin HalachevVice President of Engineering
  • 7+ years experience in data analysis

  • Ph.D. in Computational Biology

Konstantin has led data teams across multiple industries, including insurance, travel, and biology. He’s led Insurify’s engineering team for more than three years.