The most important thing is to know your position on rental car insurance before you ever walk into the rental car company. Far too many of us say, “sure” when we are offered the additional rental coverage that is offered by the agent because we are in a hurry and don’t know what else to say. To be honest, most of the time, in most cases, that additional rental insurance is not even necessary.
Before you even contact a rental car company, investigate the levels of protection, benefits and potential exclusions of your own insurance policy that may apply to a rental vehicle. Most standard, personal auto insurance policies apply the same coverage and deductibles to cars rented for leisure purposes. It’s safe to double check your policy but most states treat the rental vehicle as your “primary” vehicle for the time you will be driving it. If you are renting a vehicle for business purposes, your company’s corporate travel policy likely applies. Chances are that even your credit card company provides some degree of rental coverage as long as you meet the requirements issued by the credit card company which normally include:
*You must be the primary renter of the vehicle
*You must have declined the rental collision waiver
*You must pay for the car in full with the credit card
Types of Rental Coverage Offered
Supplemental Liability: This may be the most important one. If you are at fault for an accident while driving your rented vehicle, the insurance company will provide coverage up to $1 million if the other party files a claim against you for injuries or vehicle damage. If you have your own auto insurance, which you must in order to rent a vehicle, or if you have an “umbrella” policy, this coverage is not likely necessary.
Damage Waiver: If you are involved in an accident or the vehicle is damaged by vandalism, or if the vehicle is stolen and damaged, this coverage will take care of the damage costs. There are certain restrictions though. Accidents caused by the following will not be covered:
*Driving under the influence
*Driving in a “no rental car” area
If you have personal comprehensive and collision coverage, the damage waiver may duplicate the provisions of that policy.
Personal Effects Coverage: This coverage protects against theft or damage to personal items that are inside the rental vehicle. It does not extend to items in another car or cars involved in a collision.
Personal Accident Insurance: This coverage protects the driver and all passengers in the rental vehicle in the event of an accident (not those in the other cars involved). It provides medical benefits, such as Personal Injury Protection. In general, if you have your own Personal Injury Protection on your auto insurance policy or private health insurance, this coverage is not necessarily needed.
If You Say Yes, What’s the Price?
It’s very easy for the insurance additions to cost more than the price of the car itself! Often times, the rental agent will bundle one or two of the additional coverage together and call it a “bundle” or a “package” and classify it as a “deal.” If you buy one or more coverage option, you could be adding as much as $25 per item to the total rental cost.
Unfortunately, there is no standard answer when you ask yourself, “Do I need rental insurance?” Additional coverage can be a really good idea in certain circumstances, such as if you need a greater degree of liability protection or if you have an excessive amount of valuables in your vehicle.
Before you ever walk into a rental car company, review your own auto insurance policy and visit the rental company’s website to read the specific details of the insurance products they offer. If you don’t do these two simple tasks, you’re likely to be the victim of the last minute, hard sell “bundle” or “package” you may not even need.