In many cases, your personal auto policy may overlap with rental car insurance, and you may not need to get a separate insurance when renting a vehicle. If you have a personal car insurance policy, you can use it to cover the rental car as long as the trip is part of your personal travel. Most standard insurance companies do not provide coverage for rentals if you travel abroad, making it necessary to purchase a rental car insurance.
Do You Need to Get Rental Car Insurance?
It is important to review your personal car insurance policy before renting a car. In some instances, the coverage from your personal auto insurance may extend to rental cars. Personal car insurance coverage includes liability coverage and other additional coverage, such as collision or comprehensive coverage. The deductibles and coverage limits on your personal auto policy will also apply to rental cars if you drive one for your personal use.
However, if you do not have adequate auto insurance coverage, you will have to purchase liability coverage from the rental company before driving a rental car. Liability coverage is required for all drivers in most states. Also, if your current insurance policy does not offer comprehensive and collision coverage or you only have coverage under a commercial auto insurance policy, then getting rental car insurance is a good idea. If you are driving a rental car outside the country, your current auto insurance will not cover you, the sole exception is Canada. All U.S. auto policies extend coverage to Canada.
Rental Car Insurance Options
Rental car insurance options are usually divided into four categories by rental agencies: Liability coverage, Loss damage waiver, Personal effects coverage, and Personal accident coverage.
- Liability Coverage: Liability coverage protects you from damages if you cause injury to another individual or damage their property while driving a rental car. If the liability coverage from your personal auto insurance is sufficient, you may not need to get extra liability coverage from a rental car agency.
- Loss Damage Waiver: This option covers total loss, environmental damage, theft, and vandalism. If you cause damage to the rental car during the rental period and it is sent for repairs, the loss damage waiver will protect you from the fees for each day the car spends at the repair shop. A collision damage waiver is similar to a loss damage waiver, but it does not cover damages due to theft.This is a coverage we generally recommend to our clients to purchase. The reason for this is that your personal auto insurance does not cover things like a flat tire replacement, or loss of use fees that the rental company passes along while the car is in for repairs. If you have these additional coverages through a premium credit card (gold or platinum cards for example), you can forgo this coverage, but please check with your credit card company prior to renting. For this coverage to be active, you will need to use that card for rental to get additional coverages.
- Personal Effects Coverage: If your personal belongings get stolen from a rental car, personal effects coverage will help cover the loss of such items.
- Personal Accident Coverage: If you or your passengers are injured in a rental car accident, personal accident insurance covers the ensuing medical bills. This type of coverage is similar to Medical payments coverage and Personal Injury Protection (PIP). If you have either of these options, you need not get a separate personal accident coverage.
Depending on the type of coverage you already have in place, you may or may not require a rental car insurance policy. To understand more about rental car insurance, you can reach out to your insurance provider or contact us at Lou Aggetta Insurance Services. We are ready to assist you with all your auto insurance needs today!