Insurance Rental Car Coverage: What You Need to Know

When renting a car, many people wonder if they need the extra insurance coverage offered by the rental car company. The answer isn’t always straightforward, as it depends on your own insurance policy and the type of coverage offered by the rental car company.

What is Rental Car Insurance Coverage?

Rental car insurance coverage is a type of coverage you can purchase when you rent a car. It typically includes several types of coverage, including:

These types of coverage can be expensive, but they can also provide peace of mind when renting a car.

Do You Need Rental Car Insurance Coverage?

Whether or not you need rental car insurance coverage depends on your own insurance policy and the type of coverage offered by the rental car company.

If you have comprehensive and collision coverage on your own auto insurance policy, you may not need to purchase additional coverage from the rental car company. Your own policy may provide coverage for damage to the rental car, as well as liability coverage.

However, if you don’t have comprehensive or collision coverage on your own policy, or if you don’t have liability coverage, you may want to consider purchasing the extra coverage from the rental car company.

What is Collision Damage Waiver (CDW)?

Collision Damage Waiver (CDW) is a type of rental car insurance coverage that covers damage to the rental car if you are in an accident or the car is stolen. CDW is often offered by rental car companies, but it can be expensive.

If you have comprehensive and collision coverage on your own auto insurance policy, you may not need to purchase CDW from the rental car company. Your own policy may provide coverage for damage to the rental car.

What is Liability Coverage?

Liability coverage is a type of rental car insurance coverage that covers damage to other people’s property and injuries if you are at fault in an accident. Liability coverage is required by law in most states and is typically included in your own auto insurance policy.

If you have liability coverage on your own policy, you may not need to purchase liability coverage from the rental car company. However, if your policy only provides the minimum required liability coverage, you may want to consider purchasing additional coverage from the rental car company.

What is Personal Accident Insurance (PAI)?

Personal Accident Insurance (PAI) is a type of rental car insurance coverage that covers medical expenses if you or your passengers are injured in an accident. PAI is typically not necessary if you have health insurance or if your own auto insurance policy includes medical payments coverage.

What is Personal Effects Coverage (PEC)?

Personal Effects Coverage (PEC) is a type of rental car insurance coverage that covers theft of personal belongings from the rental car. PEC is typically not necessary if you have homeowners or renters insurance that covers your personal belongings.

FAQ

Is rental car insurance coverage required by law?

No, rental car insurance coverage is not required by law. However, liability coverage is required by law in most states, and it is typically included in your own auto insurance policy.

Does my own auto insurance policy cover rental cars?

Your own auto insurance policy may provide coverage for damage to the rental car and liability coverage. However, the coverage may be limited, so it’s important to check with your insurance provider to see what is covered.

Will my credit card provide coverage for rental cars?

Some credit cards offer rental car insurance coverage as a benefit to cardholders. However, the coverage may be limited, so it’s important to read the terms and conditions of your credit card agreement to see what is covered.

How much does rental car insurance coverage cost?

The cost of rental car insurance coverage varies depending on the type of coverage and the rental car company. CDW can be the most expensive form of coverage, while liability coverage may be less expensive.

Should I purchase rental car insurance coverage?

Whether or not you should purchase rental car insurance coverage depends on your own insurance policy and the type of coverage offered by the rental car company. If you have comprehensive and collision coverage on your own policy, you may not need to purchase additional coverage from the rental car company.

However, if you don’t have comprehensive or collision coverage on your own policy, or if you don’t have liability coverage, you may want to consider purchasing the extra coverage from the rental car company.

Can I decline rental car insurance coverage?

Yes, you can decline rental car insurance coverage if you have coverage through your own auto insurance policy or if you are willing to take the risk of not having coverage. However, it’s important to understand the potential risks before declining coverage.

Conclusion

Rental car insurance coverage can provide peace of mind when renting a car. However, whether or not you need coverage depends on your own insurance policy and the type of coverage offered by the rental car company.

If you have comprehensive and collision coverage on your own policy, you may not need to purchase additional coverage from the rental car company. However, if you don’t have comprehensive or collision coverage on your own policy, or if you don’t have liability coverage, you may want to consider purchasing the extra coverage from the rental car company.