Rental Car Insurance: What You Need to Know

Examining the fine print of insurance coverage options while renting a car can be difficult and, let’s face it, uninspiring.It’s not as thrilling as deciding between a showy convertible, a practical compact, or a seven-seat monster SUV.

You could be thinking to yourself, “Do I really need insurance?”
Isn’t it true that my auto insurance won’t cover an accident?
What about the automobile rental bonuses offered by credit cards?

Here are a few things you should know before driving your rental car off the lot or using a car-sharing program.

Is it necessary for me to get additional rental car insurance?

If you don’t have collision coverage or if you don’t have your own auto insurance policy, you might want to consider renting a car.If the rental policy does not duplicate the auto coverage you already have, it is the most cost-effective option.

Depending on the type of coverage you select, rental car insurance might cost up to $50 per day. When renting an automobile, there are typically four types of coverage available:

If a car is destroyed while you’re renting it, a loss-damage waiver, also known as a collision damage waiver, protects you from culpability.The cost of this coverage ranges from $9 to $19 a day, depending on the state, vehicle, and rate.For example, Alamo charges roughly a Waiver Saver plan at $9 per day for a collision damage waiver, whereas Hertz charges around $45 for a loss-damage waiver and the same for a collision damage waiver.

If you’re renting a car and have your own insurance, it’s possible that your coverage won’t cover the whole cost of the vehicle, therefore you’ll need a loss-damage waiver. Furthermore, if you don’t have a loss-damage waiver, the auto rental company may charge you for lost time while the vehicle is being repaired, as well as any towing fees. You’ll need the waiver if your primary insurer doesn’t cover these.

In the event of a collision, liability coverage covers damage to any property as well as medical bills for passengers in another car. Protection is normally limited to $1 million and costs between $7 and $15 per day. If you have your own insurance, check to see how much liability coverage it includes for rental properties.If you don’t have an umbrella policy or the rental’s coverage limit is higher, you’ll be safest with the additional liability protection.

Personal accident insurance, which normally costs $1 to $5 per day, covers medical bills for you and your passengers in the event of an accident.
Even if you already have health insurance, there may be gaps, such as deductibles, that could leave you with increased medical expenditures following an accident.

Personal effects insurance, which costs roughly $1 to $4 per day and covers goods kept in the car in case of theft, is available.Even if you have automobile insurance, it won’t cover what’s inside, so you’ll need additional coverage.

What are the benefits of popular car-sharing services?

ZipCar, RelayRides, GetAround, and Car2Go are just a few of the popular car sharing firms that offer insurance to their customers.Check with your insurance or automobile issuer about their policies on car share services if you want further protection.

Zipcar is the world’s largest car-sharing business, with users able to choose from a choice of automobiles and pick up their reservations at certain places. It includes collision coverage as well as personal injury protection. It also includes $300,000 in liability coverage per accident. A $1000 damage fee per occurrence is imposed on members, which can be decreased with the purchase of an optional damage fee waiver.

Turo is a peer-to-peer automobile sharing service that is available in over 2,100 locations and 300 airports across the US.It provides renters with three additional protection alternatives. There are a variety of plans available, ranging from one that limits your collision exposure to $500 and provides $300,000 in liability coverage to one that provides no car damage protection and only the state’s minimum liability coverage.Furthermore, if you’re traveling and haven’t decided on a car yet, RelayRides allows you to hire a car at dozens of airports across the country.

GetAround is a peer-to-peer car-sharing service that is currently only offered in the San Francisco Bay Area, San Diego, Austin, Portland, and Chicago. It covers renters’ liability up to the vehicle owner’s limits or a combined single maximum of three times the state minimum, whichever is higher.Personal injury protection (in jurisdictions where it is required), comprehensive/collision coverage, extra medical payments coverage, and uninsured and underinsured motorist coverage are also available from the company (in states where it is mandated).

Car2Go is a smart automobile rental business that provides one-way point-to-point transportation.Unlike ZipCar, it allows consumers to use a smartphone app to access automobiles wherever they are parked.Liability insurance, uninsured motorist coverage, and collision and comprehensive coverage are all available, with differing limitations and deductibles depending on the state.Personal injury protection is available in each state separately.

What is normally covered by auto insurance?

A standard rental is usually covered if you already have a vehicle insurance policy.
It is feasible to obtain non-owners auto insurance if you do not own a car and do not have car insurance.To find out what coverage is available, contact your regular insurance provider, such as your homeowners insurer.

If you have car insurance that covers rentals, it will almost certainly include collision, theft, and vandalism coverage.In most cases, liability works the same way in a rental car claim as it does in a conventional car claim.If you are involved in an accident, file a claim with your insurance company exactly as you would if you were driving your primary car.

Loss of usage, loss of value, and other rental expenses are unlikely to be covered by your primary policy.In addition, most motor insurers won’t cover an accident if you’re driving for work or driving internationally.Your claim may also be refused if an accident occurs while someone else is driving a car you hired under your name and that person is not identified on the rental car agreement.PEMCO, for example, specifically states that coverage will not be provided until the motorist is mentioned on the policy, not just given random “permission.”
The company also won’t cover you if you’re going on a business trip or driving internationally.

What are the limitations of credit card car insurance policies?

You can also use your credit card to get secondary rental insurance—and in certain situations, primary—to get coverage that goes beyond what your primary motor insurer or a rental firm can supply.

If your credit card includes rental car insurance, it will typically cover expenditures not covered by your regular auto insurance policy.To be covered by your credit card, you must reserve the rental car under your name and use a credit card with the same name.
To get insurance coverage through your credit card, you usually have to decline coverage given by the rental car business.

Here are what the most popular card networks cover:

Visa offers rental car insurance on all of their cards, but only for a maximum of 15 days in the United States.Physical damage, theft, and loss of usage are all covered.
However, in order to be eligible for loss of use, the rental firm must show that its fleet is fully employed, which means that the majority of its vehicles are in use.
Injury, property damage, taxes, damage to other vehicles, lost value, or tire wear and tear are not covered.

Only Platinum, Gold, World, and World Elite MasterCards come with automobile rental insurance.The rental time is restricted to 31 days, with a maximum coverage of $50,000.
MasterCard provides coverage for the same occurrences as Visa and has the same exclusions.

All of American Express’s basic cards come with complimentary secondary coverage up to $50,000, which covers physical damage and theft.Car rental loss and damage insurance is now covered up to $75,000 for Platinum cardholders.Basic coverage excludes depreciation, taxes, wear and tear, property damage, and personal injury.Full rental automobile insurance must be declined, however partial coverage can be accepted.For a nominal cost, it also offers primary coverage, which includes property damage and injuries as well as additional coverage of $100,000.

Discover only covers a few of its credit cards.
Most only cover up to $25,000 in accident damage, however the Discover Escape card covers up to $50,000.It excludes theft, damage not caused by an accident, and loss of use.

Before renting, review your card’s rental collision policy or contact your issuer to find out what the issuer will and won’t cover.Furthermore, certain automobiles may be excluded from coverage by card networks.

To minimize last-minute anxiety while you’re standing at the rental counter, conduct your research ahead about different rental firms.Then check your own auto policy or contact your credit card company to see what kind of coverage is available to cover any gaps.