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Rental Car Coverage: Do You Really Need It?

April 29, 2016

You’re standing at the counter of the rental car company. You’re filling out their paperwork and you’re inevitably asked whether you want rental car coverage insurance. Then you start to think, “Do I really need this? Shouldn’t I be covered already?”. No one wants to spend more money than they need to, so compare.com has answered these questions for you.

Is Rental Car Coverage Really Necessary?

It’s something you don’t really think about until you are standing at the counter in the rental car company’s office. It can be hard to tell if you really need rental car coverage and the high pressure situation of standing at a counter with someone waiting on you might encourage you to spend less time considering your options. Don’t worry, we’ll help you get to the bottom of this.

Available Rental Car Coverage Options

There are multiple ways that you can be covered if something should happen to your rental car. Your options include:

  • Your Regular Auto Insurance Coverage
  • Credit Card Supplied Rental Car Coverage
  • Loss Damage Waiver 

Your Existing Auto Insurance Policy

If your current car insurance policy states that it covers a rental car, then this will be your primary insurance and all additional insurance will be excess or supplemental insurance.For many people, this will be enough. However, drivers with low coverage levels and people renting expensive vehicles may want to consider purchasing additional insurance to protect against damages to your rental vehicle that could exceed the limits of what your current auto insurance policy covers.

Credit Card Rental Car Coverage

If you have existing car insurance, any other form of insurance will be supplemental or excess insurance , as we mentioned above. If you choose to use your credit card for rental car coverage, be sure to check the coverages that are included. These details can typically be found on your credit card company’s website. Your credit card company may not cover all damage to your rental vehicle. For more information, check the terms of your credit agreement. Credit cards do not typically cover liability or personal injury protection.

Loss Damage Waiver or Collision Damage Waiver

The loss damage waiver or collision damage waiver is provided by the car rental company and frees the driver (you) from responsibility pertaining to damage to the vehicle. This waiver does not provide coverage for liability or personal injury. It is essentially an agreement stating that the rental agency agrees not to hold you fiscally responsible for damages to the rental vehicle for a specified fee. Liability and personal injury are not included in loss damage waivers. For these protections, you must rely on your own insurance. If you do not have car insurance, then you’ll need to purchase rental car coverage from the rental company.

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