Being well-prepared is key, and that includes having sufficient insurance coverage while driving a rental automobile. You may purchase additional insurance via the rental car agency or use a credit card that includes vehicle rental insurance if your own policy does not cover rental cars.
- Is Auto Rental Insurance Necessary?
- Get auto insurance on your own.
- Does my credit card cover insurance when I rent a car?
- How to Utilise Your Credit Card for Rental Car Insurance
- Varieties of Rental Car Insurance
- How to Get Insurance for a Rental Car
- Getting rental car insurance from a third party
- Are you sure you want to rent a car?
- When you might need insurance for a rental car
- When you might not need insurance for a rental car
- In Short
For your peace of mind, before you drive away from the rental lot, consider purchasing rental vehicle insurance. We’ll walk you through the process, explaining how it works and where to purchase it.
Is Auto Rental Insurance Necessary?
You should be aware that renting a vehicle does need auto insurance, while it is not required that you have your own policy.
To lawfully operate a motor vehicle in the United States, one must have either auto insurance or other evidence of financial responsibility. Therefore, insurance is mandatory if you hire a vehicle in the United States. You have alternatives; the coverage offered by the rental vehicle agency is simply one of them.
There are usually a few methods to get insurance:
Get auto insurance on your own.
- Visit the rental vehicle agency to get short-term insurance.
- Use a credit card that offers rental car insurance to reserve the vehicle.
- Invest in temporary or non-owner auto insurance.
- Are Rental Cars Covered by My Insurance?
- You may be able to get rental vehicle coverage with your regular auto insurance. Renting a car for personal use in the US or Canada is probably already covered enough by your current insurance.
- Make sure you know what you’re getting into by calling your insurance company before you walk to the rental car counter.
Included in standard vehicle insurance plans are liability and any other coverages mandated by the state. Additional coverage options, including as collision and comprehensive, are also included of full-coverage packages.
Each form of coverage does the following:
| Type of Insurance | What It Covers |
|---|---|
| Comprehensive | Covers automobile repair or replacement for non-collision losses or damage, such as theft, fire, vandalism, or tornadoes. |
| Collision | covers the cost of repairing or replacing the vehicle in the event that it is damaged in a collision with another vehicle or object, flips, or has pothole damage. |
| Liability | When you are responsible for a catastrophe, you are responsible for the expenses associated with property damage and injuries sustained by others. |
| Medical payments coverage (MedPay) | Addresses the expenses of medical treatment for you and your passengers, irrespective of liability. |
| Personal injury protection (PIP) | Covers your and your guests’ hospital bills, lost wages, and other costs, even if you were at fault. |
| Uninsured and underinsured motorist insurance | Covers your medical expenses and property damage if another motorist causes an accident and lacks suitable insurance. It also protects you in hit-and-run scenarios. |
Does my credit card cover insurance when I rent a car?
Insurance for rental cars is often included for free with many credit cards if you pay for the car with your card. The coverage is in the form of an accident damage waiver or loss damage waiver (more on that later). You may hear people call it insurance. You don’t have to pay as much if your rental car gets destroyed or stolen if you sign these waivers.
You will have to contact your credit card company directly to find out if you are covered.
How to Utilise Your Credit Card for Rental Car Insurance
To utilise your credit card for rental car coverage, follow these steps:
Review the advantages of your credit card. To determine whether your card provides this type of benefit, you may access your online account, contact the card issuer, or review the card agreement. Additionally, verify whether it is primary or secondary coverage.
Determine whether you require additional coverage. In general, liability, personal possessions, medical expenses, and personal injury are not covered by credit cards. In such cases, you will be required to utilise either your personal car insurance or rental car insurance.
Remit payment for the rental vehicle. The benefit is typically activated by registering the car rental in your name and applying the expenses to the credit card that provides the loss damage waiver.
Refuse the collision insurance offered by the car rental agency. You have the option to decline the rental agency’s insurance coverage if you have determined that it is unnecessary.
If you are required to submit a claim, please reach out to your card issuer to determine the subsequent actions. Typically, you will be required to submit photographs of the damage, as well as copies of the accident report form, police report, auto rental agreement, repair estimate, and itemised repair bill.
Varieties of Rental Car Insurance
Your rental car may be entirely safeguarded by your credit card and auto insurance. If not, you may supplement the rental car company’s insurance coverage deficits.
Four types of insurance are typically provided by rental car companies:
Waiver of Loss Damage
This coverage, which is also known as collision damage waiver, is comparable to comprehensive and collision coverage. It absolves you of any financial liability for the larceny or damage of the rental vehicle. Towing, administrative fees, or loss of use fees are also included in certain policies. Typically, the cost of this waiver ranges from $15 to $30 per day.
Insurance for Liability
If you are involved in an accident while operating a rental vehicle, liability coverage will cover your legal expenses. Rental car companies are legally obligated to provide the minimum level of liability coverage that is mandated in the state in which the vehicle is being rented. Supplementary liability insurance, which typically costs $8 to $17 per day, can be used to increase your coverage limits.
Personal Accident Insurance (PAI)
PAI provides funding for medical expenses for both you and your passengers, similar to medical coverage or PIP. PAI typically ranges from $1 to $5 per day. Your personal health insurance plan may already provide sufficient coverage for medical expenses.
Protection of Personal Effects (PEP)
Personal property that has been misappropriated from your rental vehicle is reimbursed by PEP. This may be covered by your homeowners or tenants insurance; however, you will be required to pay the insurance deductible if you submit an insurance claim. A PEP plan with no deductible may be a favourable option, as the average cost of PEP is only $1 to $2 per day.
How to Get Insurance for a Rental Car
The rental car company will usually let you buy insurance for your car ahead of time when you book it. You can decide at the last minute if you need rental car insurance or not. You can buy it when you pick up the car. People who rent cars will often offer insurance at the time you pick up the car, even if you don’t want to buy it.
Getting rental car insurance from a third party
Rental car insurance can also be bought from outside car insurance companies that offer rental car insurance, such as
- Allianz Worldwide Help
- Bonzah Rental Cover Sure
Just remember that you’ll need to buy third-party rental car insurance before you pick up your car. This is different from insurance that you can buy straight from the rental car company.
Are you sure you want to rent a car?
Getting insurance through the car hire company might be a good idea sometimes, but it depends on your individual needs.
When you might need insurance for a rental car
Think about getting insurance for your rental car if:
- Your personal policy either doesn’t cover collisions and comprehensive or only covers damage.
- You don’t want to use your personal policy to file a claim.
- You want to drive the rental car somewhere other than the United States or Canada.
- Your credit card doesn’t cover you, and you don’t have your own car insurance.
When you might not need insurance for a rental car
You might not need rental car insurance, though, if:
- The covering in your own car insurance policy is enough.
- Extra support is available through your credit card.
- You bought a contract from a different company that stands on its own.
In Short
Find out what kind of car insurance you need before you leave for your trip. You should look over the limits of your personal car insurance and see if you have a credit card that covers car rentals. To keep your rental car safe, use the defences you already have instead of paying extra for services you don’t need. You can buy extra insurance through the car rental company ahead of time, though, if you need it.
