By Madeline Klein on July 26, 2018 in Insurance Basics
It can be confusing when you are renting a car to know if you really need their rental car insurance. You likely already have a car insurance policy that will cover some of the same aspects that the rental car insurance does. Many also don’t realize parts of their homeowner’s or renter’s insurance can help provide coverage, as well as their credit card potentially.
We’ve put together some common questions we’ve heard about rental car insurance to help you answer the question: Should I get rental car insurance?
Options for rental car insurance
The first step is to understand the different types of rental car insurance options available. You can read in-depth about rental car insurance here, but overall rental car companies typically offer four types of insurance:
- Liability coverage
- Collision Damage Waiver (CDW), also known as a Loss Damage Waiver (LDW)
- Personal accident insurance
- Personal effects coverage
A big thing to pay attention to when you’re trying to decide if you need that insurance is to look at your current coverage and policies. These options provided by rental companies may help fill in some gaps to help you feel safer while you travel in an unfamiliar car.
Rental Reimbursement Coverage and vacation car rentals
While some may believe rental reimbursement coverage applies to vacation rentals, it actually does not. Rental Reimbursement coverage from most car insurance companies only applies to rentals needed for an accident that is part of a covered claim. The car in the accident must be one the car insurance company insures. This coverage doesn’t help pay for a rental needed simply because you’re traveling.
For those who have Rental Reimbursement from Say, as part of their everyday auto insurance, keep in mind that this coverage only covers a rental car if you need one while your car is being repaired. The repair has to be from an accident covered under your Comprehensive or Collision coverage.
Roadside Assistance and a rental Car
Another common question is if you can use your Roadside Assistance for a rental. And the answer is that you typically cannot. Your Roadside Assistance typically only applies to your everyday car or a rental that is needed because your car is in the shop due to an accident.
For Say’s coverage, you can’t use your Roadside Assistance if you have a rental because you and your friends are hitting the road for some summer fun. If you have a different provider, we suggest calling them to figure out what their coverage includes.
Credit card coverage for rental cars
Many don’t know that their credit card may provide another coverage option. Some credit card companies will pay for damages to rental cars after your personal insurance company pays. They also may even cover towing costs. However, this coverage usually does not extend to damages to another vehicle, the theft of personal belongings in the vehicle, or liability for bodily injury or property damage. This all is, of course, subject to your credit card’s contract details.
Coverage may also vary depending on the type of card you have. For example, a platinum card may offer more coverage than a gold card. Check with the credit card company you plan to use to pay for the rental car before your trip so you know what your options are.
The verdict on rental car insurance
We suggest breaking down the rental car insurance options and checking them against your other insurance policies. If you feel the coverage the rental company offers can fill in a gap in your current policies, you may want to spend the extra money on it. You are on vacation, after all, and nothing can bring a trip down like a car accident or theft. More coverage means less you have to worry about and more time to relax!