"Joseph Coulter" wrote in message
...
On Mon, 04 Jan 2010 21:41:38 GMT, "neverwas"
wrote:

I think most major credit cards do this, at least if you're above the
basic level. I know my Visa Platinum card does.

FWIW nor do any of my 3 UK credit cards provide cover for car hire.
It sounds like you are contemplating the kind of third party insurance
that I encourage and that I take on my rentals in Australia. ie in
lieu of the CDW from the car hire company.
Joseph Coulter
Joseph Coulter Cruises and Vacations
www.josephcoulter.com

You probably recommend it because it has very fat margins.

By any reasonable standards, CDW from car hire companies is a complete
rip-off.

I insure a $60,000 motor car for about $800 per annum, or about $2.50 per
day. That's $2.50 to insure a $60,000 loss. The excess on most car rentals
is $2,000, and that is all most CDW covers. It typically costs $20/day.

So when I am driving my own car, $2.50 a day carries a $60,000 risk. If I am
driving a rental car, $20 carries a $2,000 risk. The insurance per dollar
covered for CDW is 240 times as much for other car insurance.

That's basically why some credit card companies give it away for free. The
real value of insuring a $2,000 excess through CDW is probably closer to
$2,000/$60,000 * $2.50, which is about 8 cents a day. Small enough for
credit card companies to give it away for free. Yet car companies charge
$20/day. And many people buy it, because they can't work out the math to
realise what a rip-off it truly is.