In most situations, your car insurance can cover rental cars. You might not require extra coverage if your policy covers liability, comprehensive, collision, medical payments (MedPay), and personal injury protection (PIP). However, certain exclusions might be applicable, or you might have coverage gaps that need a separate policy. That is why it’s crucial to check your coverage before renting a car.
Understanding your car insurance policy’s limits and deductibles is crucial as they apply to claims covering rental cars. Additionally, auto insurance may have additional restrictions on coverage for specific uses, situations, and losses. Furthermore, before renting a car, it’s crucial to consult your insurance company or agent to determine the coverage of your auto insurance policy.
What Does Car Insurance Cover for Rental Cars
Car insurance follows the vehicle, not the driver. However, it does not apply when you are renting a vehicle for personal use. If you have car insurance, it would cover rental cars. Moreover, if you don’t require additional rental car coverage, ensure your current policy includes the following types of coverage first.
Liability coverage
If your rental car is involved in an accident that results in property damage or injuries to other people, liability coverage will cover you. This will probably already be covered by your auto policy’s liability insurance.
Collision and comprehensive coverage
The damage to your car is covered by these two types of coverage. When your car is involved in an accident with another vehicle or object, collision insurance will pay for repairs. In addition to theft, comprehensive insurance covers other kinds of damage. If you have a car loan, your lender likely requires you to have both types of insurance in your policy.
Personal injury protection (PIP) and medical payments (MedPay)
This kind of coverage covers losses resulting from the collision, such as missed income, childcare costs, burial costs, and more. It also covers medical costs for you and your passengers. Unlike liability insurance, this coverage can begin to pay out regardless of fault. In many states, PIP and MedPay are required.
Furthermore, you can use the coverage options listed in your car insurance policy when renting a vehicle. They should be viewed as the absolute minimum required for you to properly decline the rental insurance.
How Do I Know If My Car Insurance Can Cover Rental Cars
Before signing any rental car agency paperwork, ensure your car insurance covers rental cars by calling your agent. Insurance won’t cover rental cars in case of accidents or damage if you don’t have liability, comprehensive, or collision coverage.
The reason for the trip is a crucial consideration when determining whether your car insurance will cover rental cars. If you get rental cars for a business trip, your policy may not cover you if your car insurance does not cover business use. Double-check your auto insurance policy before accepting or refusing insurance at the rental office to ensure adequate coverage.
Should I Get Rental Car Insurance
It might not be necessary to get rental car insurance if you already have car insurance or coverage for rental cars through your credit card. However, there are a few situations where purchasing additional rental car insurance might be advantageous and worthwhile:
Have large deductibles
When compared to a high deductible with your personal auto policy, rental car insurance coverage frequently has no or low deductibles, meaning you could pay much less or nothing out of pocket in the event of a claim.
Prevent claims of your auto insurance
In addition, to prevent a possible rate increase on your auto policy, you would file a claim with the rental car company when you have insurance.
You don’t have collision or comprehensive coverage
You can be protected against physical damage to your rental car by adding a loss-damage waiver if your auto policy does not include collision or comprehensive coverage.
Low liability coverage limit
If your auto policy has the state minimum liability limit, renting additional coverage from the rental company will provide you with more protection if you are at fault for an accident.
You’re traveling
The majority of American auto insurance only offers coverage within the country. If you are visiting a nation where your auto insurance policy does not offer coverage, renting car insurance could be crucial.
Final Thought
If you have existing homeowners’ and health insurance policies that match the counter-offered coverage or have comparable coverage through your personal insurance policy, you may not need rental car insurance. If you have no other choice or need to cover any gaps in your current policies, it might be worthwhile. Also, consider getting the CDW from the rental car company to cover damages, if you have car insurance but not comprehensive or collision. It’s a good idea to compare rates from several rental car companies before heading to the counter.