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If there is a rule to buy car rental insurance, it is this: do not make your decision at the counter.
With so many options available – and the potential to save money by taking advantage credit card benefits or your existing car insurance politics – making a decision on the fly can be expensive, according to experts.
“Getting car rental insurance at the car rental desk is the most expensive option out there,” says Jonathan Weinberg, co-founder and CEO of the car rental website AutoSlash.
For now, non-essential travel has been largely disrupted due to the pandemic. If you are planning a future trip, you can use this time to review car rental insurance tips and tricks that will save you money and provide the coverage you need when it’s time to hit the road again.
In fact, you may not need to purchase insurance at the car rental desk. Here’s how to decide when you need coverage – and when you can decline the offer.
What are the different rental car insurance options?
The rental car insurance options can be divided into a few different categories. They are:
If you cause a car accident, liability coverage will help pay for any damages or injuries you cause to the other party. It does not cover your own injuries or damage to the vehicle you are driving. Since liability coverage is required in almost every state, you probably already have it as part of your car insurance policy. However, if your limits are low, you may want to purchase additional liability coverage when renting a car.
Collision / Loss Damage Exemption
A collision / loss damage waiver is not technically secure. It is a contract that prohibits the car rental company from suing you for loss or damage to the rental car while it is in your possession. Covers theft and damage from collisions, vandalism, weather and other incidents. With this waiver, you do not have to pay a deductible and all losses or damages will be covered without limits. Many credit cards offer this benefit to their users, but the requirements and terms vary.
Personal accident coverage
Personal accident coverage helps pay your medical bills if you are injured in a car accident. If you have personal injury protection or medical payment coverage as part of your auto insurance policy, you do not need to purchase personal accident coverage, as long as you do not mind paying your deductible. Personal accident coverage also offers a one-time payment in case of accidental death, which can be doubled if you have a life insurance policy.
Coverage of personal effects
Often sold in conjunction with personal accident coverage, personal belongings coverage helps pay to replace your belongings if they are damaged during the rental car or stolen from the rental car. Most homeowners / renters policies cover your belongings, even while you are traveling, so if you already have this coverage, you probably do not need to buy personal property coverage at the rental desk.
Rental car insurance vs. Your Own Car Insurance
Rental car collisions and theft
Your insurance: Collision coverage helps pay for damage to your vehicle after an accident, and comprehensive coverage helps pay for damage caused by other events, such as vandalism or hail. This coverage usually extends to rental cars, but you will still have to pay your deductible – and you can stay on the hook for covering the loss of use of the vehicle by the rental company. This means that you may be forced to pay the daily rental fee for the time it takes to repair the vehicle.
Rental insurance: If you purchase a collision / loss damage waiver, you are protected from financial liability for anything that happens to the vehicle. This includes damage and theft, as well as loss of use. A collision / loss damage waiver is not an insurance product, but an agreement that the car rental company will not sue you for any damages. There is no need to file a claim in the event of an accident and paperwork is generally minimal. Some people choose to buy the exemption simply because it is more convenient and does not require a deductible.
Many credit cards include a collision-free benefit as an advantage – but specific terms and conditions will apply. Call your issuer for details before declining at the counter.
“Whether or not your insurer will cover the rent depends on your insurer,” says Shawn Powers, vice president of sales and operations at To hold, a shopping comparison site for insurance policies. Powers says he usually buys the exemption at the rental desk for convenience and guaranteed protection, especially for short-term rentals. Your insurance company may not cover the loss of use of the vehicle by the rental company, which means that you may be charged the daily rental fee for the time it takes to repair the vehicle. And even if your insurance company covers these expenses, you will still be subject to a deductible. “I don’t want any of those headaches,” said Powers.
Damage and injury to other drivers
Your insurance: Liability coverage is required in most states. This coverage will help pay for injuries or property damage incurred by another party in an accident you cause, whether you are driving your own vehicle or a rental car. If your limits are low, however, you may want to consider purchasing supplemental liability coverage.
Rental insurance: Supplemental liability coverage pays for injuries and damages to others with much higher limits than the typical minimum liability coverage required by most states. It is important to purchase this type of insurance when renting a car, if you do not have your own insurance policy.
Medical expenses for you and your passengers
Your insurance: Your health insurance policy will likely cover your medical bills, and if you have personal injury protection or medical payment coverage as part of your automobile policy, it will take effect as a secondary insurance and cover your deductible. If you have a life insurance policy, you are also entitled to death benefits if you die in an accident.
Rental insurance: Personal accident insurance will cover medical expenses for injuries that you or your passengers suffer in an accident. It will also pay a full amount to your beneficiaries if you die in an accident.
Stolen or damaged belongings in the rental car
Your insurance: Most homeowners ‘and renters’ policies cover stolen or damaged belongings worldwide, so you can file a claim even if something happens while on vacation. However, you will need to pay your deductible and you will only be covered up to the limits of your policy. You will also need to complete a police report before the owner’s or lessee’s insurer reimburses you.
Rental insurance: If you purchase coverage for personal effects at the rental desk, you are covered against stolen or damaged belongings in the vehicle to a limit.
Using your credit card for rental car insurance coverage
Many credit card issuers offer collision / loss damage waivers as a benefit to cardholders. It is usually secondary coverage, meaning it goes into action after your auto insurance policy, but some premium travel rewards cards offer primary coverage. Limits and exclusions vary, however, be sure to check the terms of your credit card agreement before relying on this coverage.
In order for your credit card coverage to be applied, you must charge the full amount of the card, place the rent in your name and refuse coverage at the counter.
Some exemptions included as a benefit for cardholders exclude loss of use fees and cannot be used for certain vehicles, such as large vans or luxury cars, says Weinberg. They also come with coverage limits.
“Some policies only cover up to $ 50,000. If you are tempted by that Mercedes SL convertible that has a $ 70,000 sticker and is totaled, you may be on the hook for the [difference] between what your credit card policy covers and the high-quality vehicle, ”said Weinberg.
You should also check if there is a limit to the number of days that a rental can be covered and read the fine print for any other exclusions, such as international rental.
Third party car rental insurance
Some third-party rental insurance providers may offer car rental insurance that you can purchase per day at a significant discount compared to what you would pay at the rental desk. Weinberg said AutoSlash has partnered with Sure to offer customers car rental insurance for less than half the price they would pay at the counter. There are a few other options to consider. You can buy these policies online and then refuse coverage at the counter.
Of course, plans start at $ 10 a day and vary by state, and you can get a quote for your rental car on the Sure website. The right coverage is supported by Chubb and includes up to $ 100,000 of coverage for damage or theft of the rental car. You will also have coverage in case of loss of keys, flat tires, fuel failure and towing.
Allianz Global Assistance
Allianz Global Assistance offers coverage from just $ 9 per day ($ 7 for Florida residents), and you can get a quote for your rental car online. The plan includes a primary collision damage waiver covering up to $ 40,000 in vehicle damage or theft, up to $ 1,000 each in trip cancellation and baggage loss / damage coverage and access to a 24-hour hotline.
Bonzah’s damage coverage costs $ 7.99 per day and covers up to $ 35,000 in vehicle damage or theft. Insurance is primary and there is no deductible. You can also add extras, such as emergency roadside assistance and supplemental liability coverage.
What makes sense to me?
Weinberg and Powers said it is essential to cover the rental car itself – so if you do not have comprehensive and collision coverage on your car policy, and you are not using a credit card that includes the exemption as a benefit, you should buy the waiver of damage due to collision / loss at the counter or through a third party insurer. If you are going to refuse coverage at the counter, “first I would make sure my policy did,” says Powers.
Review all your options in advance, experts advise. “Staying at the car rental desk at the end of the car rental agent’s difficult sale is probably not the best time to think about whether or not you can be covered,” says Weinberg. This may mean calling your insurance agent, reviewing the fine print of your credit card contract and comparing the coverage available through third-party insurers.