DOES MY INSURANCE COVER MY RENTAL CAR IF I'M IN AN ACCIDENT?
I was talking to a friend the other day and he told me he had an accident, which meant he was going to be without his car for about 3 or 4 days. So he said he would have to rent a car while his was getting his repaired. He then started to ask me a few questions, which made me think others might need to have these answers before they get into this situation or even if they are renting a vehicle while on vacation. Having these answers will make it easier to deal with and a lot less confusing.
- Does my insurance cover the cost of a rental car?
- Does my insurance cover Collision Damage if I’m in an accident with my rental or do I need to get the added coverage with the rental car company?
- Does my insurance cover Liability Insurance while I’m renting a vehicle or do I need to get the added coverage with the rental car company?
- Does my insurance cover Personal Accident Insurance or do I need to get the added coverage with the rental car company?
- Does my insurance cover Personal Effects or do I need to get the added coverage with the rental car company?
You can bet your paycheck that the Rental Car agent will ask you these questions when you go to get your rental car. As we all know, insurance is a necessary evil. You never think you’ll need it until you do. They will ask you the questions above because they want you to be covered in case something happens….and they want to sell you these add ons. This is why if you are armed with the answers, it will not only make it easier for you when you are getting your rental car but it will make it quicker as well.
The first thing you should do prior to going to get your rental car (or when you have a few minutes so you are prepared when you do need it), contact your insurance agent/company and ask them these questions.
If after you talk to your insurance company, and you find out your car insurance doesn’t have sufficient coverage, contact the Credit Card Company of the card you will be using for the rental vehicle (you will be asked to give the rental car company a credit card to act as a deposit). If there are any gaps in coverage with your personal auto policy that needs to be covered, the credit card company may provide secondary coverage.
Does my insurance cover the cost of a rental car?
If you purchased the optional coverage, “Rental Reimbursement”, this can help pay some of the costs of the rental car. Your coverage will spell out how much you have per day towards the rental and the maximum amount you have for your claim. Some insurance companies have agreements with rental car companies so if you choose to use another company, you may have to pay the costs upfront and then get reimbursed.
The following questions deal with Rental Car Coverages. The rental company will offer some options that you may not need. Find out from your insurance company to see if you already are covered so you don’t pay for something you already have.
Does my insurance cover Collision Damage if I’m in an accident with my rental or do I need to get the added coverage with the rental car company?
Collision Damage Waiver (CDW)/Loss Damage Waiver – This is not an insurance product, but rather a waiver that transfers financial responsibility from you to the rental company in case of damage or theft. In most cases, waivers also provide coverage for “loss of use” if the rental company charges for the time a damaged car cannot be used because it is being repaired. This can cost $10 - $20 a day from the rental company.
Check with your insurance company and credit card company to make sure you’re already adequately covered and you may be able to decline this coverage.
Does my insurance cover Liability Insurance while I’m renting a vehicle or do I need to get the added coverage with the rental car company?
If you purchase this from the rental company, it will provide in excess liability coverage of up to $1 million for the time you rent a car. Rental companies are required by law to provide the minimum level of liability insurance required by your state. Generally, this does not offer enough protection in a serious accident. If you have adequate liability coverage on your car or an umbrella policy on your home/auto, you may consider forgoing this additional insurance.
This additional insurance can cost $5 - $10 from the rental company.
Does my insurance cover Personal Accident Insurance or do I need to get the added coverage with the rental car company?
This provides coverage to you and your passengers for medical/ambulance bills. This type of insurance can cost about $3 a day from the rental company. This may be unnecessary if you are covered by health insurance or have adequate medical coverage under your auto policy.
Does my insurance cover Personal Effects or do I need to get the added coverage with the rental car company?
This provides coverage for the theft of personal items in your car. However, if you have homeowners or renters insurance, you may be covered for items stolen from the car, minus your deductible. You will need to have receipts or other proof of ownership. This type of insurance can cost around $1.25 per day.
Some rental car companies combine personal accident and personal effects coverage together as on type of insurance, while others sell them separately.
Some additional questions you may need to be aware of:
How old does a driver generally have to be to rent a car without any restrictions or fees?
While it can vary by company, the age is usually 25. There can be exceptions, such as if you are in the military or are using the car for business travel. Some companies also let you pay an additional “under-age driver fee” if you aren’t 25.
What is “Loss of Use Charges”?
In the event of an accident while in your rental car, the rental car company can charge you the rental fee for every day the car is being repaired. Many companies will offer “loss of use insurance” with the rental.
Sometimes the simplest things like renting a car can turn into a nightmare, unless you are prepared. Taking a few minutes to get answers from you insurance company can save you time and money.