Most car rental places offer rental car insurance. But, do you really need it, or are you covered by your personal car insurance? That is the biggest question people ask themselves when renting a vehicle. The first thing you should do is call your insurance company. They will be able to tell you if you are covered in a rental or not.
If you don’t have your own car, you won’t have car insurance, therefore you should buy the insurance offered by the rental company.
Otherwise, you probably have all the coverage you need from your own insurance and don’t need short term car insurance from the rental agency. Before you decide, though, find out everything your policy covers. In most cases, your policy covers you in a rental the same as in your own your car. The same deductibles apply, as well. If you are renting a car for business, your company’s travel policy will likely be enough.
In some cases your credit card might offer a certain amount of non owner car insurance. You should call them to find out.
Rental Car Insurance – Coverage
All insurance offers a variety of coverage options to help you tailor your policy to your needs. When you buy insurance at the rental counter, these options are not outlined or explained unless you ask. To avoid complications later, in case something bad does happen, it is best to read all of the fine print. Find out exactly what you are paying for. This is the only way to gauge whether the cost of the premium is worth the money.
Liability is the most important coverage. This covers you when you are at fault in an accident. The company guarantees up to one million dollars in damages if the other person claims injury or vehicle damage. Luckily, if you do have your own car insurance, you won’t need to buy extra coverage from the car rental company.
The damage waiver clause is for vandalism, theft or damage to the vehicle through no fault of your own. This coverage carries restrictions. If the damage was caused by excessive speeding, reckless driving, driving on unsafe roads, or driving under the influence of drugs or alcohol, you will not be covered because you are directly responsible for the careless behavior that led to the damage.
Personal comprehensive and collision insurance coverage will be waived under these conditions, as well.
Content coverage reimburses you if the rental car was broken into and your personal items were stolen or damaged. Items attached to the car, such as the stereo are covered under this section, but the property was not your loss, so the rental company will be reimbursed for that. And most likely, they have their own insurance policy for such incidences.
If you are in an accident, personal accident insurance protects you and your passengers, not people in the other vehicles involved or pedestrians that may have been hurt during the accident, they are covered by liability insurance.
This insurance will pay for medical bills and other personal damage suffered by you or your passengers. If you have sufficient personal health insurance, you don’t need this additional coverage.
Rental Car Insurance – How Much Does it Cost
Obviously, the price will vary depending on how much coverage you purchase. The cost may also vary greatly from one car rental company to another. It is possible for the rental car insurance to cost more than the rental price of the car.
Rental agents have been known to group two or more types of additional coverage together and call it a deal, or a special offer. This special package can add up to $25 or more per extra coverage option. Since most people that rent a car never suffer any damage at all, this is pure profit for the rental company.
Rental Car Insurance – You Have to Report Any Loss or Damage
Many people think that when they buy rental car insurance, the deal is between them and the rental agency. This is true, but if any loss or damage does occur, you must report the incidence to your own personal car insurance company.
Even if you use your credit card insurance to pay for damages, you still have to inform your car insurance company.
Why? Because of repercussions from the accident. It is very unlikely that the rental car is the only thing damaged in an accident, even a minor fender bender involving no one else but you and telephone pole or guard rail. If you hit a telephone pole or guard rail, someone will want that damaged section replaced or repaired.
Someone will be looking to you to pay for the damage. If you inform your insurance company, they will pick up the tab. Otherwise, you will have to pay for it yourself.
If injury was caused to another person, you could be facing a liability suit. A claim can be filed months after the accident if the person is not recovering as expected. It is best to tell you insurance company right away in case a claim does come up.
There is no standard answer as to whether you need to buy rental car insurance. Most people never have an accident and think they have wasted their money by buying the extra coverage. Many others have passed on the insurance, had a terrible collision and had to pay the damages out of their own pocket.
The simplest answer is if you have sufficient personal car and medical insurance, you do not need it. Ask your insurance company before you decide.