If you intend to travel on a long road trip somewhere, you may have considered a rental car. Taking a rental is sometimes much more convenient than your own car. For example, some folks are paranoid about taking their commuting vehicle on a long trip. Others don’t want to rack up annual maintenance and servicing costs, and instead take a rental whenever they need to drive somewhere. Either way, one thing’s for sure – rental car insurance is something not to be taken lightly.
As with all things insurance, there are a lot of ifs and buts to this topic. To simplify this, we’ve listed down some frequently asked questions regarding rental car insurance so that you get the best pointers possible.
What is rental car insurance?
Rental car insurance is the optional insurance you can choose to protect yourself and the vehicle from accidents or mishaps during the rental period. It is essentially a hedge against anything untoward that may happen during the time you operate the vehicle.
When you take a lease, the rental company will likely ask if you want rental insurance. The rates vary depending upon which state you are in. If you choose to do so, you will be buying the minimum liability coverage required in that particular state. You could also choose to purchase additional coverage if you feel like it.
Is rental car insurance really necessary?
Folks often claim that their car insurance policy covers rental insurance. Even so, we recommend that you take the additional rental car insurance for the following reasons. If you’re renting a car somewhere new and are traveling along unfamiliar roads, there’s a greater chance you could have an accident. Driving in a new city can be daunting enough without dealing with errant drivers and navigating traffic. Even a minor dent in your fender can lead to spiraling costs. It’s best not to leave anything to chance – get rental car insurance. Period.
In addition, an accident could increase your own personal car insurance premium by up to 30%. Having rental car insurance helps you avoid these whammies to your finances.
Rental insurance also provides additional protection that may not be included in your policy or which could be omitted under a commercial car insurance policy provided by your employer.
What rental car insurance do I need?
It’s a good idea to keep some standard points in mind when choosing rental car insurance. Check if the company provides the following essential coverage items – Supplemental liability insurance, Personal accident insurance, Loss damage waiver, and Personal effects coverage.
- Supplemental liability insurance (SLI): This covers the cost of damages and injuries you may cause while driving the car. Suppose you have an accident because of your fault and the other driver/ pedestrian ends up in the hospital. In that case, liability cover will take care of their medical bills and repair charges. This is generally included in most personal car insurance policies.
- Personal accident insurance: This is paid out if you or any passengers in your rented vehicle are injured in an accident. Again, personal health insurance policies already include this in their list, while auto insurance includes this under personal injury protection (PIP).
- Loss damage waiver (LDW): This is also called the Collision Damage Waiver (CDW) and is intended to protect you from paying for any dents, bumps, and mishaps like theft that may happen to the rental car you use. If you don’t opt for this, the rental company can charge you “loss-of-use” fees – for money lost during the time the car is being repaired. This is a useful cover to have even if your personal car insurance policy extends to rental cars.
- Personal effects coverage: This is useful in cases when your personal belongings have been stolen from the rental car. Things like laptops, cell phones, accessories like Bluetooth speakers, and gadgets are common targets for car burglars. However, you can choose to avoid this if you have homeowner’s insurance.
How much does rental car insurance cost?
Similar to personal car insurance premiums, rental car insurance rates vary based on the state, company, and many other factors. If you choose full coverage, the total cost can be between $30-45 per day.
If you want to see the breakup of each component, here are some ballpark figures to help you make up your mind.
- Supplemental liability insurance (SLI) : $8-12/day
- Personal accident insurance: $3/day
- Loss damage waiver (LDW) : $20-30/day
- Personal effects coverage : $2/day.
Do credit cards cover rental car insurance?
Yes, some credits cards double up to fill the gaps in your personal car insurance policy. However, it varies depending on which state you rent the car in and your own credit card company.
Some credit cards that include rental insurance are:
- Capital One Visa Platinum card
- American Express Delta SkyMiles cards, American Express Green, American Express Gold, and American Express Platinum cards
- American Express Hilton Honors and Starwood Preferred Guest cards
- Chase Hyatt and Chase World of Hyatt cards
- Chase Sapphire Preferred and Chase Sapphire Reserve cards
How do I find the best rental car insurance rates?
The easiest way to find affordable car insurance for rentals is to compare quotes from various insurance providers online. You can start your research on car insurance rates by getting free insurance quotes on Way.com.
Check out our blogs for info on finding top-rated airport parking, the best parking spots in your city, and affordable car washes near you.