Rental Car Insurance and Its Coverage

Rental Car Insurance and Its Coverage

In today’s day and age, buying a car is expensive. Apart from the excessive initial investment, the costs of repairing and maintaining a vehicle will mount up in the years to come. Thereafter, a lot of people have now resorted to going car-free. Moreover, eco-conscious individuals are also massive proponents of public transport and consider personal cars a nuisance.

Along with public transportation, a great option for locomotion is renting vehicles. They are the perfect choice for individuals who are worried about the difficulties of owning a car but still want the comfort of a personal vehicle. Nowadays, there are multiple ways to rent a car in the United States, and the process is quite inexpensive. And the best part is that you do not have to worry about maintenance—just fuel up and drive.

But is everything as picture-perfect and hassle-free as it appears? Well, rental cars also come with a fair share of risks and liabilities. In such cases, rental automobile insurance helps. These are what, and do you need rental car insurance? See for ourselves!

 

About rental car insurance

The US has many car rental firms. In the US, there are 3313 automobile rental companies. You can drive your favorite cars in luxury, convenience, and affordability with these companies.

Also read: How Much Car Insurance Do You Need?

Car rental companies have several considerations despite their restricted duties. Drive carefully and get car rental insurance to avoid damage. You could crash a rental car or have it stolen. Rental automobile insurance can help you handle such unexpected events.

 

Rental car insurance—how it works?

Rental car insurance differs from personal auto insurance, so be aware. The rental business, location, and other factors affect benefits and coverage. Rental car companies usually offer four insurance choices. These include LDW, liability, personal accident, and personal effects insurance.

Rental car insurance works differently from conventional car insurance, and benefits and coverage vary by firm and location. Rental automobile insurance typically offers three coverage options.

Collision Damage Waiver comes first. This coverage covers rental automobile body damage but not tires, motors, windshields, etc. It does not cover DUI or dangerous driving.

Also read: Why Non-owned Automobile Insurance is Important for Businesses?

Second, theft protection. Having your rental car stolen can be costly. Theft insurance protects you against the costs. It covers theft attempts and damages.

Final coverage is third-party liability. If you crash a rental automobile, this coverage covers third-party damages.

Let us check out these rental car coverages in further detail!

  • Rental car liability insurance

A lot of rental car businesses sell liability car insurance, which covers the property damage and injuries of other drivers from an accident happening because of your fault.

  • Rental car loss-waiver insurance

It waives your responsibility to pay for a total loss, environmental damage, theft, vandalism, and accident damage to your rental car. These waivers serve as comprehensive and collisional policies for the rental organization.

  • Personal Accident Car Rental Insurance

As the name suggests, this type of car rental coverage pays for medical bills for you and your passengers, irrespective of whichever party is at fault for the accident. Personal accident car rental insurance is similar to MedPay and PIP (personal injury protection) that you receive on your standard vehicle. If you already have these insurance products, you will not need personal injury coverage for your car rental.

 

Ancillary Rental Car Insurance Coverage

  • Credit Card Rental Coverage

Many individuals are unaware that premium credit cards often cover rental cars. High limits and full claim handling are included in primary coverage. Hence, your own insurance company will not know about the claim and will not raise the rates.

On the contrary, standard cards come with secondary coverage, which has lower limits and requires you to file a claim with your own insurance company first. In either case, the criteria is to book the car rental with the concerned credit card to qualify for coverage.

  • Car Rental Travel Insurance

It is another ancillary rental car insurance that covers collisions and loss of use at a cheaper price.

  • International Car Rental Insurance

If you are planning to travel to Mexico or Canada from the States with a rental car, your personal insurance may not be enough to cover rental cars in those locations. In such a context, it is ideal to opt for internal car rental insurance.

 

Do you need rental car insurance?

You should opt for rental car insurance in the following circumstances:

  • Your personal auto insurance policy or credit card does not cover liability or damage to rental vehicles.
  • You would prefer not to handle the burden of administrative costs that your insurance company declines to cover, such as claims, reimbursement, and others.
  • You should not submit a claim for a small problem.
  • If the cost of renting the automobile is far higher than what your credit card or personal insurance will cover, you may wish to consider purchasing rental car insurance.
  • Sharing driving with an uninsured individual is planned.

On the other hand, you can skip car rental insurance in the following circumstances:

  • Your motor insurance policy is comprehensive and fully covered, with sufficient limits for liability.
  • You have health insurance for medical expenses.
  • Your homeowner policy covers theft or damage to your property.
  • You have an excellent credit card that offers rental car coverage, either as primary or secondary.

 

Wrapping It Up

So, there we have it: a crisp overview of rental car insurance and its coverage. At times, your personal insurance may include coverage for rental cars. For instance, auto liability insurance, medical insurance, and homeowners insurance usually include some element of rental car coverage.

Furthermore, depending on your home state or the state where you are renting the car, your basic auto insurance may even cover rental car damage, even if you do not have collision coverage.

Finally, keep in mind that whether or not you require rental auto insurance is dependent on your policy. Use planned research for comparing insurance or credit card coverage to your rental circumstances. And in case of confusion, do not forget to call your car insurance or Credit Card Company.