Whether you are renting a car for the first or the fiftieth time, there is always a little concern in the back of your mind. After all, you are going to be driving a car that belongs to someone else. What happens if you are in an accident? Your car insurance is for your own personal vehicle and you as a driver. Does it apply to your rental car?
With these questions in your mind, you head to the rental car counter. One of the first things they ask is whether or not you want to purchase insurance. How are you supposed to know? You need to know ahead of time what coverage you have and whether or not you need this extra coverage.
One thing to keep in mind is that your existing car insurance may already cover your rental car. To find out, you can either review your coverage policy documentation, or you can call your agent. Calling your insurance agent will be the quickest way to determine if your insurance policy covers car rentals. By law you must be covered with liability insurance. Liability insurance covers any damage caused by you and the vehicle you are driving to other people and vehicles. However, liability does not cover any damage caused to the rental vehicle. If you are in an accident in your rental car and only have liability coverage, you will be liable and have to pay for damage to the vehicle you are driving.
One other consideration is the fact that if your rental vehicle is very different than the vehicle you normally drive, such as a full sized van compared to a compact car, your insurance company may not be willing to cover your driving in the rental. Always check before renting the car just to be sure. If your current insurance does cover rental cars, and is willing to cover the car you are renting, you probably do not need the extra insurance.
Another way you can have insurance on your rental car is through your credit card provider. As an incentive for their customers to use their cards when renting vehicles, many credit card providers offer rental car insurance. Before assuming that yours does, however, you need to call and check. Also, make sure you ask what is covered and how much the total monetary coverage would be if there were problems. Remember, you might find that the insurance offered through your credit card is not sufficient, meaning you may want some extra coverage as well. On the other hand, you may find that the credit card's coverage combined with the coverage your existing insurance policy gives you is sufficient.
What if you find that your existing coverage options are not enough? Then it is time to pay for the insurance offered by the rental car company. This is an added cost, but the alternative is having to pay for damage caused to the car, yourself, other drivers, and other cars in the event of an accident. Since the rental car company has your credit card information, they can easily track you down and charge you for the damages caused while you are driving the car.
Rental car companies will offer you even more insurance options. One of these is insurance against any injury to yourself or your passengers. This sounds great, but if you already have health insurance you do not need it. However, if there is a reason you do not want to rely on your health insurance, such as a policy with a high deductible or problems getting medical care outside of your provider network, this insurance can help bring you peace of mind.
Another added insurance option that the rental car company may offer is insurance for your belongings. While this insurance is nice when you are traveling, keep in mind that your personal belongings may be covered under your homeowner's insurance policy. It is a good idea to check before you head to the car rental counter.
Finally, in many states you will be asked if you want to have a Collision Damage Waiver, otherwise known as a CDW. While CDW is not insurance, it is quite similar. This waiver only adds a few dollars to the rental each day, and if anything were to happen to the car, such as a scratch or an accident, you would not be charged. Now, you might be thinking that you do not need this if you have collision insurance, but if your car is damaged in a collision the car rental company has the right to charge you for the days it is in the shop getting repaired. The CDW exempts you from these types of charges.
When choosing whether or not to purchase for your next car rental, make the decision that makes you feel secure. It's just important to keep in mind that you may already have coverage similar or identical to the coverage being offered at the rental car company. At the end of the day, however, the biggest thing you need to remember is fun you are enjoying on your vacation, so if purchasing additional coverage eliminates some of the stress of your trip, then by all means do it!
