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Mandy Sleight has over 15 years of insurance knowledge and expertise in auto, home, life, health, pet, supplemental benefits, and other insurance products. She’s a sought-after insurance expert, appearing in Bankrate.com, Moneygeek.com, U.S. News & World Report, Reviews.com, CNET, and other publications, and she's been writing for Compare.com since 2023.
Mandy uses her background and experience working for well-known insurance companies like State Farm and Nationwide Insurance to create engaging and easy-to-understand content that helps readers make smarter insurance choices that have a positive effect on their budgets and finances.
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Nick Versaw leads Compare.com's editorial department, where he and his team specialize in crafting helpful, easy-to-understand content about car insurance and other related topics. With nearly a decade of experience writing and editing insurance and personal finance articles, his work has helped readers discover substantial savings on necessary expenses, including insurance, transportation, health care, and more. As an award-winning writer, Nick has seen his work published in countless renowned publications, such as the Washington Post, Los Angeles Times, and U.S. News & World Report. He graduated with Latin honors from Virginia Commonwealth University, where he earned his Bachelor's Degree in Digital Journalism.
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Amanda Clear is a licensed Property and Casualty insurance agent who runs her family insurance agency providing coverage in the states of Connecticut, New York, and Vermont. She specializes in providing customized insurance packages to her clients that provide the best coverage for the price that they can afford. She holds a bachelor's degree in English from Sacred Heart University in Fairfield, CT, and works as a freelance editor, proofreader, and writer outside of her insurance career.
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Whether you drive your own car or you’re renting, you’ll want to make sure you have auto insurance coverage. If you rent a vehicle and don’t have your own car insurance policy, you’ll need to get coverage as part of the rental agreement if you don’t want to get stuck with a potentially costly repair bill.
Car rental insurance can cover your personal property and rental car damage or supplement your existing policy. You can purchase it at the rental counter, as part of a travel protection plan, or through a third-party company.
Here’s what you should know about rental insurance and how it can protect your finances.
You might already have coverage for a rental vehicle through your personal car insurance policy.
There are several types of rental car insurance options to choose from, and they may be optional if you have other coverage available.
Having rental insurance can prevent the rates on your personal insurance policies from increasing if you file a claim.
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If you already have car insurance, you probably don't need to purchase additional coverage. But you'll need some sort of coverage in order to rent a car.
Without personal auto insurance coverage, the rental agency will require you to buy liability coverage and collision insurance. If you get in an accident while driving a rental vehicle and don’t have the right type of coverage, you could end up with a hefty out-of-pocket repair bill.
Rental car insurance protects you financially if you get in an accident or someone steals your rental car. If your vehicle is damaged or stolen, you’ll file a claim through your insurance policy or the one you purchased from the rental car company.
That said, there are several types of rental insurance available, and each covers different types of damage or loss. That can make things a bit confusing when you’re at the rental counter, so we’ll discuss your options in more detail below.
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Rental car insurance can cover multiple types of losses, including:
Theft of the vehicle while you’re on vacation, traveling for work, or using a rental while your car is in the repair shop.
The cost to replace personal items stolen from the rental car, such as cameras, laptops, luggage, and clothes.
Bodily injury or property damage you cause to others while driving a rental.
Your medical treatment costs if you’re injured in an accident.
The cost of repairs or replacement of the rental vehicle if it’s totaled after an accident.
Your personal auto insurance policy can cover rental cars, but it depends on the type of coverage you have. A liability-only policy would cover bodily injury and property damage you cause to others, but it wouldn’t cover the rental car itself.
If you have a full-coverage policy, it would also cover comprehensive and collision insurance claims. Comprehensive insurance can cover damage from events like natural disasters or if the vehicle is stolen. Collision coverage may pay if you cause an accident that damages your rental.
Medical payments and personal injury protection (PIP) can cover your medical expenses if you get injured in an accident. There’s also an optional add-on you can include in your policy called rental reimbursement coverage. This coverage will pay some or all of the cost to rent a car if yours is in the repair shop after a covered accident, up to the limit outlined in your policy.
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You have a few different options to insure your rental car. Let’s take a look at each.
Your personal car insurance policy can extend coverage to a rental vehicle as a substitute for your car. But if you get into an accident or the vehicle gets stolen, you’d still have to pay your comprehensive or collision deductible. And if you’re at fault in the accident, your insurance company might raise your rates.
Some credit cards — especially travel cards — offer benefits like rental car coverage, but you’ll have to check the fine print to know if it’s primary or secondary coverage. With primary coverage, you’d file the claim through the credit card company. But with secondary coverage, you’d have to go through another pre-existing policy first, like your car insurance. Most credit cards offer secondary coverage.
If you owe a deductible under your personal policy, the secondary coverage might reimburse you. But secondary coverage may not be enough for everyone, especially if you don’t have an existing car insurance policy. For example, it won't cover medical bills or property damage. Talk to your insurance agent or your credit card’s customer service department if you’re unsure.
Even if you have auto insurance, you can still purchase several different types of coverage from the rental company (we’ll discuss each of them in detail later on). Purchasing rental car insurance from the company can help prevent you from paying a deductible and protect your insurance premiums. It’s up to you to decide if that extra cost is worth it.
Several third-party companies offer their own rental insurance you can purchase if you don’t want to go through the rental company or your own insurance policy. For example, Allianz Global Assistance offers OneTrip Rental Car Protector for $11 per day, offering up to $50,000 in primary coverage for collisions, baggage loss or damage, and trip interruption.
RentalCover.com provides primary collision damage waiver coverage and liability insurance for domestic rentals. It’ll also cover theft, collisions, flat tires, cracked windshields or headlights, towing costs, and lost keys.
Bonzah and Sure also provide rental car insurance, allowing you to choose the coverage you want at various price points.
Rental car insurance costs can vary depending on the vehicle you rent, the type of coverage you want, and where you purchase insurance from. The rates outlined below are in addition to the cost of renting a car and are subject to change.
A collision damage waiver (CDW) can cost anywhere from $10 to $20 per day. Personal effects coverage can cost between $5 and $16 daily, and supplemental liability insurance (SLI) can range from $7 to $17. If you add personal accident insurance, it’ll also cost around $5 per day.
Rentalcover.com’s website states its rental car insurance is 50% cheaper than what it costs through rental car companies. Bonzah’s basic CDW coverage is $22 daily, and SLI costs $12 daily.
Rental car insurance is often worth it, but in the end, it’s up to you. You don’t want to be stuck paying huge expenses you didn’t account for, especially if you’re traveling out of the country.
If you’re worried about the cost of rental car insurance, check to see if you have primary coverage elsewhere and then supplement what you don’t have.
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If you don’t have personal auto insurance, you have several other options. You might have coverage on a credit card, get a stand-alone policy through a third-party company, or buy insurance from the rental company itself.
Here are the common types of insurance you’ll usually see at the rental car counter.
A collision damage waiver (CDW) is the same as a loss damage waiver (LDW). The waiver negates your financial responsibility for damages you’ve incurred to the rental car, as long as the cause of damage isn’t prohibited in the rental agreement.
You might have this coverage already if you have car insurance or a credit card with CDW benefits. Although your personal auto insurance won’t cover you outside the U.S. or Canada (and sometimes Mexico), credit card coverage may be international. Check with your credit card company first.
Personal effects coverage (PEC) covers your personal belongings if they’re stolen from your rental car. Each policy has coverage maximums and may have exclusions and limitations, so be sure to read the fine print of the rental agreement.
Your renters or homeowners insurance may cover your personal items but may limit how far away from your home you’re covered. You’d also pay a deductible and could see a rate increase for filing a claim.
If you or your passengers get injured in an accident, personal accident insurance (PAI) can help pay your medical bills. Check your auto or health insurance first to see if you have coverage where you’re traveling and if PAI is worth purchasing.
If you cause an accident that injures others or damages their property, supplemental liability insurance (SLI) could prevent you from paying out of pocket for repairs. Your auto liability insurance may cover you, but only up to your liability limits, and it usually won’t cover you outside the U.S. or Canada. Getting SLI may be worth it if you have low liability limits on your auto policy.
Rental car insurance can be a cost-effective way to protect yourself financially when renting a vehicle. We’ve answered some of the most common questions about rental insurance below.
It depends. Whether you need extra insurance when renting a car in the United States varies on your personal car insurance coverage.
For example, a collision damage waiver is required if you only have liability coverage on your policy. Supplemental liability can increase your coverage limits for additional protection.
No. Rental insurance isn’t a rip-off. It can provide peace of mind when traveling, knowing you’re covered if something happens to your car rental or your stuff gets stolen out of the vehicle.
That said, not all drivers need to buy rental insurance at the rental counter. Checking your auto insurance and credit cards before you buy can ensure you only purchase the coverage you need.
Many Chase credit cards — including the Sapphire Preferred and Reserve and Ink Business cards — offer primary rental car insurance. The Bilt Mastercard, United Explorer card, American Express Platinum card, and Capital One Venture X Rewards credit card also offer primary rental car insurance coverage.
It depends. Some companies offer it, but not all.
Enterprise offers Roadside Assistance Protection (RAP) as an optional add-on to cover refueling, lockouts, and lost keys. Avis extended roadside assistance covers jump-starts, fuel delivery, lockouts, and flat tires. And while Hertz includes basic roadside assistance, it only covers mechanical defects — though you can upgrade for more coverage.
It’s possible, but you’ll usually have to pay extra.
It also typically only covers physical damage to the rental vehicle and may offer roadside assistance. However, travel insurance might not cover you if you cause an accident and injure others or damage their property.
Sources
District of Columbia Department of Insurance, Securities & Banking. “Things to Know About Car Insurance and Rental Cars Before Starting Your Road Trip.” Accessed November 3, 2023.
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Mandy Sleight has over 15 years of insurance knowledge and expertise in auto, home, life, health, pet, supplemental benefits, and other insurance products. She’s a sought-after insurance expert, appearing in Bankrate.com, Moneygeek.com, U.S. News & World Report, Reviews.com, CNET, and other publications, and she's been writing for Compare.com since 2023.
Mandy uses her background and experience working for well-known insurance companies like State Farm and Nationwide Insurance to create engaging and easy-to-understand content that helps readers make smarter insurance choices that have a positive effect on their budgets and finances.
Nick Versaw leads Compare.com's editorial department, where he and his team specialize in crafting helpful, easy-to-understand content about car insurance and other related topics. With nearly a decade of experience writing and editing insurance and personal finance articles, his work has helped readers discover substantial savings on necessary expenses, including insurance, transportation, health care, and more. As an award-winning writer, Nick has seen his work published in countless renowned publications, such as the Washington Post, Los Angeles Times, and U.S. News & World Report. He graduated with Latin honors from Virginia Commonwealth University, where he earned his Bachelor's Degree in Digital Journalism.
Amanda Clear is a licensed Property and Casualty insurance agent who runs her family insurance agency providing coverage in the states of Connecticut, New York, and Vermont. She specializes in providing customized insurance packages to her clients that provide the best coverage for the price that they can afford. She holds a bachelor's degree in English from Sacred Heart University in Fairfield, CT, and works as a freelance editor, proofreader, and writer outside of her insurance career.
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