Do I Need Rental Car Insurance Coverage?April 29, 2016
How do you know when you need to purchase rental car insurance coverage? If you have ever rented a vehicle, for any purpose, odds are you have been asked by the person behind the counter whether you would like their supplemental rental car insurance or not. After hearing the salesperson’s explanation, it usually sounds like it’s a good idea to purchase their supplemental rental car insurance. However, you may be paying for something you don’t need.
What Does Rental Car Insurance Cover?
Typically, rental car insurance offers the same or similar protection as your regular car insurance. It is usually a middle-of-the-road policy that covers damages to the car and, in some cases, injury to the passengers (though to what extent depends on the individual policy. Read the rental company’s policy for details about their coverage and consider how it compares to your existing car insurance coverage).
Making a Choice on Rental Car Insurance Coverage
In many cases, the insurance offered by the rental company will be duplicate coverage when combined with your existing auto insurance. This is especially true if you have high coverage limits, or additional types of coverage beyond comprehensive, collision, and liability. If your regular car insurance coverage tends toward the minimums of coverage, then it might be a good idea to look over the renter’s policy and see if it offers better coverage.
Another issue that you should consider when deciding whether or not to buy rental car insurance is that if you make a claim on the rental company’s policy it won’t raise your personal car insurance premium.
You should also consider that the credit card you are using to pay for the rental car may include rental car protection. While this isn’t the case with every credit card, you should check to see if your credit card includes rental car coverage to avoid paying for duplicate coverage.
So Do I Really Need Rental Car Insurance?
It depends. We highly recommend consulting your current car insurance policy to check your current auto insurance coverage. It’s also a good idea to check whether or not your credit card comes with this rental car protection. It may not be worth the additional protection for some, but if you want to avoid making a claim on your own insurance, then the rental company’s coverage may be a valid solution for you.
If you aren’t sure whether you are adequately covered to drive a rental car, contact your agent and ask them to review your policy and determine whether or not you’ll need the extra coverage.
Auto Insurance A to Z
It’s easy for a lot of folks in auto insurance to forget that most people don’t know what they’re talking about when they refer to liability coverage, or an SR-22. Our Auto Insurance A-Z Guide helps decrypt things, unpacking these concepts into language you and I can understand.