If you are traveling using a car rental, consider the following regarding insurance so you know just how to accept or reject the additional insurance offerings at the rental kiosk.
Does your personal auto insurance cover rental cars?
If so, do you need additional coverage? The answer to this depends. If you don’t buy rental car insurance, are you prepared to pay for the damages out of pocket? If you cause an accident, you are liable for the damages. If liability is covered by your personal auto insurance policies, then you will be covered for liability when renting a car.
Keep in mind, you need to have full coverage on your personal vehicles in order to have the full coverage extend to a rental car. The deductibles on your car insurance will still apply to the rental car.
What does “full auto coverage mean?”
Full coverage includes collision coverage and comprehensive coverage. Collision coverage offers protection if you wreck your vehicle and it is your fault. Comprehensive coverage protects you from any loss you may have to your vehicle such as, theft, flood damage, hitting a deer, etc.
Note: if you are traveling across state lines the state insurance laws depends on the state you are currently driving in and will apply.
Sometimes accidents occur that still may not be covered by your full auto insurance.
Here are a few coverages that are not included in personal auto policies that you need for your rental car insurance:
Loss of use: If you wreck the rental car and the accident was your fault, you will be responsible for the cost and the time it takes for the vehicle to be fixed and the time it is not usable by the rental company. Most personal insurance companies exclude this coverage, meaning they will not pay for the time and money the rental car company is losing because of something that was your fault.
Loss of Value: If you wreck a $25,000 car and after repairs it is valued at $20,000, you are responsible for the difference. This can add up to a huge expense and most insurance companies will not cover this.
So, do I need to purchase rental car insurance?
If you want complete peace of mind, get the rental car insurance. But if you decide not to get the rental car insurance and want to rely on your personal insurance policies, understand that there are events that can happen that won’t be covered. It’s always a good idea to speak with your insurance agent to understand what type of insurance coverage you have and discuss if there are any gaps in your coverage or policies that you don’t think you need.