Car rental insurance can be a very helpful thing to have when you are traveling. There are many reasons that things can go wrong that might lead to the need to use your car rental insurance. While you might not think that you will get into an accident or need car rental insurance, there are sometimes events that you cannot expect or plan on that can happen.
Car rental insurance can cover fender bender damage, serious injury, and the cost of the replacement of a car that you are renting. This can be very helpful in the instance that something that you never could have planned on takes place during your vacation or business trip. While it is not likely that you will end up in a serious accident during a trip where you have a rental car, you should never rule out things that you could not expect to happen.
If you want to learn more about the process of getting and using car insurance, read on!
Do I Need Car Rental Insurance?
Car rental insurance can be a big help in many situations. You might have full coverage that can be extended to a rental car from your existing car insurance policy. This is often the case, but it is worth checking on this detail before you rent a car and plan to use this coverage for your rental car needs. Buying the additional rental car coverage might still be necessary when you travel to certain countries and places.
Before you head out on a trip, make sure that your existing insurance will cover accidents in these areas. There are excluded countries and places that your car insurance will not cover. The extended rental car insurance that is offered at the counter might also offer improved collision and liability coverage when compared to your existing insurance policy.
Some people consider their credit cards as a good way to provide additional car insurance coverage when renting a car. You might indeed have good coverage through your credit card, but you should call your credit card company to be sure that you are getting the coverage that you think that you are. Some credit cards do not offer much in the way of coverage and you might be surprised at the gaps in these insurance coverages. Finding out what exclusions apply to the use of this coverage is critical if you are planning to use your credit card for this insurance coverage.
Does Car Insurance Cover Rental Cars?
Your existing car insurance will likely cover your rental car if you are driving the rental car in the US and if your car insurance is active and in good standing. There are some things that might not be covered in the way that you expect, however.
The limits of your existing car insurance policy might not cover a rental car that is an exotic or a car that is significantly more expensive than the one you hold a policy for. This can lead to a major problem if you do not take the extended coverage. This is less likely to be an issue if you are renting a basic car, but when you rent something that is much more expensive to purchase and replace than your existing car, you might have a gap in insurance coverage that you were not expecting.
Rental car extensions and additions are also sometimes available to be added to your existing policy through some insurers. You should look into this consideration if you are worried about using your own policy for your needs while you are traveling. In some cases, adding this extension to your policy will be just as much or more than choosing to take the added coverage at the counter, which might make the choice less important for your needs.
Is Rental Car Insurance Worth It?
Rental car insurance that is offered at the counter can be expensive. You might not want this added expense on your plate when you are already paying to rent a car. If you have the right level of coverage from your existing car insurance policy and you are going to be driving in the US, you might not need to add additional coverage.
That being said, there are places that have different coverage levels required by the state than what is required in your home state. If you are driving in California, for example, you might not have the minimum car insurance level that will meet their $5,000 property damage requirement. This can also apply to minimums for personal injury protection, and for damages that are not to property.
This gap in the levels of insurance coverage can lead to issues when a claim has to be filed and the insurance policy that is being used for the claim does not cover as much in the way of damages as it should. This is where rental car insurance can help you to meet the levels that are required in the state that you are driving in.
Rental car coverage will also be required if you want protection when you are driving in some countries that do not allow you to use your existing policy. There are also some areas that are not covered in Mexico by most stateside insurance companies. You will need to be aware of this limitation of your existing auto insurance policy before you have a scary surprise when you find out that you do not have coverage after an automobile accident.
What Types of Rental Car Insurance Are There?
There are four options that are offered for your coverage through a rental car company. You might not elect to use all of them. When you waive something, know that you are stating that you are replacing this coverage with another equally valid coverage or planning to pay in cash for losses that might occur. You are not releasing yourself from the liability related to an accident that occurs when you are driving your rental car.
- Loss Damage Waiver (LDW)
This is the option that lets you waive responsibility for a total loss, for accident damage, environmental damage, theft, or vandalism. This waiver states that you are using your existing auto insurance for your coverage or that you are planning to pay in cash for damages of this kind. This is the choice that you will make when you have comprehensive and collision coverage on your existing auto insurance policy.
The one thing that you should know about this waiver is that you will be charged for all of the days that the rental company cannot use this vehicle in their fleet because it has been damaged. This can really add up, so you should have this in mind before you decide that this will be a reasonable risk to take with your existing insurance to cover a loss.
- Liability Insurance
This is another option that you can choose to waive or to elect to have for your rental car. This will cover the property damages and injuries that might result from an accident. If you have personal liability coverage on your policy at home, you will get this coverage from your own policy. This will not apply, however, if you are traveling for business purposes. Remember as well that this coverage will not help you to make up the difference on a loss to an exotic car either.
For those who travel all the time but do not own a car, there are policies that you can take out of your own that will give you this kind of coverage independent of owning a car.
- Personal Accident Insurance
If you are injured in an accident or your passengers end up with injuries that require medical attention, you will want to use your personal injury protection to cover this loss. This coverage is also called PIP and has to be present on nearly all kinds of auto insurance policies. Medical bills can really add up from car accidents, so you will want to have this protection in place in case you are in an accident.
If you have an existing car insurance policy, you might not need to worry about adding this coverage at the rental counter. However, if you are not protected by this kind of coverage, you will probably want to add this to your rental costs. This will help you take care of you and your passenger’s medical bills after a serious accident.
- Personal Effects Coverage
This is an option that you can elect that will cover the theft or loss of items like luggage, electronics, and cameras. You will have this coverage extension from your renter’s insurance or your home owner’s insurance in some cases. If you want to be sure that you are going to be able to get the right coverage for your needs while you are renting a car, you might need to take out this extended coverage. There is often coverage for your personal items on traveler’s insurance as well, so you might not need an additional policy if you have traveler’s insurance for this need.
This can help protect you from serious financial strain if your luggage or your other possessions are stolen or are lost in an accident. Personal effects coverage can be a great help to those who are traveling in countries that do not have the same security benefits that travel in the US often does and even when parking in a safe location, things can happen. This coverage will help you replace the personal property that you have lost due to this kind of incident.
How Much Does Rental Car Insurance Cost?
If you do not have an existing auto insurance policy or you are struggling to decide if you want to add additional coverage for your rental car, you should know a rough estimate of what the coverage on your rental car will cost. Most rental car policies will add anywhere from about $30 to $70 a day to your rental costs. This might seem like a lot, but when you consider that a car accident can cost thousands of dollars in damages as well as many more thousands of dollars in medical bills, it is a small price to pay.
You will need to add to your price considerations the cost that the rental company will incur if one of their cars is not able to be rented out while it is being repaired. This might add up to many hundreds of dollars as well. The more auto insurance coverage that you have on hand when you are in an auto accident, the more likely that you are to walk away from an accident with your finances intact. All insurance policies can feel like they are too expensive-that is until you need them.
Which Countries Are Commonly Excluded From Extended Coverage?
Most insurance companies do not cover losses on rental cars in Canada or Mexico. They will typically also offer no extended coverage to European countries. There might be extended coverages that can be added for Canada and Mexico with some companies, but this is not always the case. European coverage is almost never an option to have added to your car insurance policy that is for the US.
Your insurance agent will be able to offer you advice about the best ways to take care of your car insurance needs when you are in these places, and you might be able to get some extended coverage for your needs through traveler’s insurance. There are many ways to make sure that you have the coverage in place that you need but accepting the rental car insurance in these locations is usually the best plan of action for you to take.
What Should I Do If My Rental Car Is in An Accident?
When you are in a car accident in a rental car, you should follow most of the same steps that you would follow if you were driving your own car. You will still have to get information from the other driver and potentially take some pictures and open a claim. These processes are the same even if the later steps of the claims process are a bit different.
- Make sure that everyone in your car and the other car are all right. Call for help if someone is seriously injured.
- Exchange contact information with the other driver and get their insurance policy details. Make sure that you consider taking a picture of their car insurance card as well. Sometimes you will need more information than just the bare minimums before you can open a claim for the damages involved.
- Document the accident with pictures if possible and get the information of witnesses to the accident as well.
- Reach out to the rental car company and tell them what happened.
- If you are using your own car insurance as your coverage policy, reach out to your car insurance company and open a claim.
- Once the claim is open, you can send over your images and witness information. Provide the claims person with the contact information for your rental car company as well.
- Consider getting an attorney if the other driver was driving under the influence or there were many cars involved in your accident. This can be a good idea if you think that you were at fault as well.
- Follow the claims process as set out by the companies involved and make sure that you provide all of the information that is asked for. You will find that the claims process can work very smoothly when you are communicating effectively with the insurance companies involved.
Rental Car Insurance Can be Valuable to Have
While it might seem like paying another $30 or so a day is too much money, you might be shocked at the cost that can be associated with an accident that is not covered by car insurance. There are many reasons that rental car insurance could be a huge benefit for your needs, and you should make sure that you are not just looking at the daily fee when considering the cost of a potential accident. While you might not be driving around much during your stay in a place that you do not know well, any time that you are driving can put you at risk for an accident.
When driving in locations that you do not know, in a car that you are not familiar with, accidents are more likely than you might think. Making sure that you have the right car insurance in place to cover your rental car and any medical bills or property losses that might result from an accident is a smart thing to do. If you are traveling out of the country, you will need to make sure that you do not turn down the extended coverage unless you have a viable way to replace it with another auto insurance policy that will take care of your needs just as well.
Having car insurance on your rental car can make all the difference between a huge bill that you cannot afford and an auto incident that is manageable and much less stressful overall.
https://www.nerdwallet.com/article/travel/what-to-do-if-you-have-an-accident-in-a-rental-car
https://www.bu.edu/travelservices/files/2016/12/visa-rental-car-coverage.pdf
https://www.creditkarma.com/auto/i/file-car-insurance-claim
https://www.ramseysolutions.com/insurance/how-to-file-an-insurance-claim
