Yes, DiamondFinish Clear is great at arresting peeling paint and small rust areas on a vehicle.
Clean the area with KBS Klean (25 Parts Water and 1 Part KBS Klean) and a green pad (or similar) giving the area a light rub. Once rinsed and completely dry, apply DiamondFinish Clear to the areas. Always apply thin coats of DiamondFinish Clear.
After 24 hours from the final coat, you can cut, polish, and buff those areas after 24 hours to blend into the vehicle's clear coat.
Please check out the complete DiamondFinish Clear Application Directions before you begin your project.