When renting a vehicle, you can expect the rental agency or dealership to ask you whether you’d like to purchase rental car insurance. But do you really need it? Many drivers wonder whether the additional rental car insurance coverage offered by the rental service is truly necessary or if it’s just an added expense. It’s essential to have some sort of auto insurance coverage whenever you’re behind the wheel, whether the vehicle belongs to you or not, but you may be able to get rental car coverage through your personal auto insurance policy.
Using this option allows you the peace of mind that both your personal and rental vehicles are protected. Some credit cards may also provide insurance when you rent your car using that card, so it’s important to review your options. In this article, we’ll highlight why rental car insurance is important and how you can save money by taking advantage of your existing auto coverage.
What does rental car insurance include?
Although not legally required, it’s extremely important to have some sort of insurance coverage when renting a car. Your rental car coverage options may vary depending on the vehicle, rental company, and policy you choose. Here are some of the rental car coverages you may consider:
Collision Damage Waiver (CDW): Also sometimes called a loss damage waiver, this type of rental car insurance covers the cost of repairs or the replacement of the rental vehicle if it’s damaged or stolen. It typically includes a deductible you must pay before the coverage kicks in.
Personal Accident Protection (PAP): PAP provides coverage for medical expenses, accidental death, and disability benefits in the event of an accident while driving the rental car. It can help cover medical bills for both drivers and passengers.
Personal Effects Coverage (PEC): PEC protects your personal belongings that are stolen or damaged while in the rental vehicle. This coverage can help reimburse the cost of replacing items such as laptops, smartphones, or other valuables.
Rental Reimbursement Coverage: This coverage reimburses you for renting another vehicle if the rental car is in the shop for repairs due to an accident or mechanical breakdown. It helps ensure that you have a means of transportation while your rental car is out of commission.
You may choose one or more of these coverages provided by the rental company, depending on the auto insurance policy you carry for your personal vehicle and if it will cover a rental car. The type of coverage you choose may also depend on your unique needs and budget, so it’s important to understand what options are available to you.
Does your personal auto insurance policy cover your rental car?
Whether you’re renting a car while traveling or you need a temporary vehicle in town, your existing auto insurance policy may extend coverage to your rental car for an insured driver. In some cases, your auto insurance may extend the same level of protection to a rental car as it would your own vehicle. It’s important to note that not all policies offer this coverage, and there may be limitations and exclusions to consider. You’ll want to review your auto insurance policy or contact your insurance provider to understand the extent of your coverage for rental cars.
Besides your auto insurance policy, you may also use a credit card for rental car insurance coverage. Credit cards that offer travel perks may also include rental car insurance coverage when you use that card to book a rental vehicle. Some credit cards provide primary coverage, which means they will pay for damages or losses without involving your auto insurance. Others offer secondary coverage, which means they will only cover expenses not covered by your auto insurance. There will be limitations and exclusions to the coverage provided by your credit cards, such as “loss of use” fees, so it’s important to check with your credit card company to learn more about the terms of your coverage.
SelectQuote Makes It Easy to Understand Your Coverage or Shop for a New Policy
If you’re considering renting a car, it’s important first to review your existing auto insurance policy to decide if rental car insurance through a dealership is truly necessary. If you want to learn more about the coverage offered through your existing auto insurance, our licensed insurance agents can help. When you need assistance reviewing your existing policy or are interested in finding a new one, you can rely on our nearly 40 years of industry experience. We’re ready to answer your questions and guide you through the shopping process so you find the auto insurance policy that fits your lifestyle and budget.
