Understanding Rental Car Insurance

When it comes to renting a car, there seems to be a lot of uncertainty around whether or not you should purchase rental car insurance from the rental car agency. Here at Bearingstar Insurance, we want to help you feel confident in your decision, which is why we’re offering up a few tips and insights to help you understand what your exposures are and what additional coverages you may need. 

Understand Your Own Insurance First

Your local insurance agent is always there to give you guidance about your insurance coverages. If you don’t own a car, and thus don’t have a personal car insurance policy, your local agent can help you determine the best option for purchasing insurance for a rental car. If you do have a personal car insurance policy, your agent can help you look to see what protection you already have, and where your exposures are. Here are some things to ask about:

Does the coverage on my personal car insurance policy extend to a rental car?

Policies from some insurance carriers will allow for this, while others may not. Never assume your personal car insurance will extend to a rental car — your local insurance agent can help you know for sure.

What are the limits of my car insurance policy?  

It’s important to know the limits of your car insurance policy, especially before renting a car. For example, let’s say you own and insure a 2005 Toyota Camry, but are renting a 2018 Mercedes Benz while on vacation. Would your coverage extend to that vehicle, despite the large disparity in value? As always, your local agent can help you better understand your insurance policy and coverage.

Does my personal policy include Collision or Comprehensive coverage?

If you have Collision or Comprehensive coverage on your car insurance policy, these coverages will likely apply to a car you rent. If you end up purchasing rental car insurance from the rental car agency, the Collision and Comprehensive coverage of your personal car insurance policy will kick in as excess coverage over the rental car company policy.

You should also check with your credit card company before renting a car — some companies offer some rental car protection if you use that credit card to pay for the rental car!

Rental Car Company Insurance Options

If you’re considering purchasing an insurance policy through the rental car company, here’s a breakdown of the types of coverages that are often offered:

Liability coverage

This coverage protects you if you injure someone else or cause property damage while driving. Your personal car insurance policy also offers liability coverage, so make sure to discuss this with your local insurance agent.

Collision/loss damage waiver

This waiver can help cover the cost of repairing damage done to a rental car. It can also provide “loss of use” coverage, meaning the rental car company won’t charge you for the time that the car is in the shop and out of use, which often wouldn’t be covered by your personal car insurance policy. There are exceptions to the types of damage covered, so make sure to read the fine print and ask questions if you’re unsure.

Personal effects coverage

This option covers your personal belongings in the rental car in the event that they are stolen. If you have a homeowners, renters, or condo insurance policy, it may offer this same coverage, also known as “off-premise coverage”, but if you choose to use this, the deductible on the policy will still apply. This is another thing your local insurance agent can help you determine.

Personal accident insurance

If you were to injure yourself or someone else in a car accident, this coverage can help pay for medical bills. Again, your personal car insurance policy has a similar provision, so check with your local agent to make sure you understand the limits of your policy and if they apply to a rental car.

Before You Rent

Now that you’re sure you have the right insurance in place, you’re almost ready to go! Before you leave the rental car agency, do a thorough inspection of your vehicle. If you notice any minor damage, like scratches or dents, make sure to take pictures of this so you are not held accountable for the damage when you return the car. If you do get into an accident while driving a rental car, make sure to notify both the rental car company and your local agent so they can begin helping with the claims process.

We hope these tips help you worry less about the rental car process. If you have any other questions, please don’t hesitate to contact a Bearingstar agent today. You can visit our website to find a local agent near you: http://bit.ly/2Kdp2vm

 

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