Regarding car rental insurance, actually, the answer might be yes and no. Check this link:

http://consumerist.com/5034315/which-credit-cards-have-the-best-rental-car-insurance

They also have these other articles:

http://consumerist.com/consumer/enterprise/9-confessions-from-a-former-enterprise-rental-salesman-243325.php
http://consumerist.com/consumer/enterprise/leaks-enterprise-stores-insurance-upsell-cheat-sheet-250937.php

Consumer Reports have this to say about car rental insurance:

Resist the pitch for insurance. The car-rental agent will probably attempt to persuade you to buy insurance to cover any damage to your rented car. But your own automobile insurance policy might already provide protection. Most private policies cover rented cars as long as the person who signs the rental agreement is behind the wheel. If you have any doubts, check your policy or call your agent. Some credit-card companies also pay for rental-car coverage as a benefit for premium cardholders. Just make sure you use that card when you book your rental.

(10 insurance policies you don’t need)
3. Car-rental insurance. For $10 to $25 a day, it covers damages to cars and people if you are in an accident while driving one of the rental agency’s vehicles. Check to see if your credit card or your own auto policy will offer full coverage on a rental vehicle says Sandy Praeger, insurance commissioner for Kansas. Instead: If you’re already fully covered, don’t bother.

(Which brings back to the first link).

But, since you did your due diligence by checking your credit cards coverage, you might as well skip it.

The only one time I rented a car – actually, the company I work for – I purchased insurance anyway, as (1) the company itself suggested when renting cars, we make sure there is enough insurance, (2) it was out-of-the-province and was not feeling comfortable driving on new streets/highways and, (3) it was going to be expensed…

About the upgrade, yup, been there, done that. Again, in my only car rental experience, the car reserved for us (reservations were made by the company) was a “medium size, 4 four” car. When I arrive at the rental counter (my colleage’s flight had not arrived yet), they asked me if I wanted to upgrade it to a “2 door Mustang”. I told them “Look, this is company booked. Just give me what was booked”. In the end, I was still given the 2 door Mustang at no extra charge. Oh, despite all the “oh!” and “ah!” of the Mustang, I did not really like that car.