If you are planning to rent a car, you will be given the option of taking out insurance with the rental company. How can you be sure you are getting enough coverage? Is rental insurance even necessary?
The short answer is yes. It may be generally accepted advice to turn down rental insurance, but there’s really no reason to turn it down. Rental car insurance is inexpensive and one of the smartest moves you can make.
If you already have auto insurance, contact your agent and ask if you are covered for rental car insurance. Most people may be surprised to find they already are.
Find out what your existing insurance will cover in the event you get into a rental car accident. Does the insurance cover the loss of your personal property? Does it cover damages to the rental?
In some cases, financing a rental car on a credit card may come with benefits. Some credit card companies include what’s known as a rental car loss damage waiver to qualified cardholders.
Even if you have comprehensive coverage and collision insurance, this doesn’t mean that opting for the rental company’s insurance is a waste of money.
Most states will not pay for the company’s loss of a rental car, which even includes loss of fees associated with that vehicle. Spending a few extra bucks on the rental insurance will cover this.
Before driving a rental car into another country, find out the country’s laws on insurance limits. Chances are your current insurance is lacking.
Take the personal effects coverage if the rental company offers it. This covers any personal losses such as jewelry, clothing, laptops and other personal property, even if these items get stolen. Without the personal effects coverage, you could end up paying a large deductible after filing a claim with your homeowners insurance. This could be as much as a couple thousand dollars.
In the event that you do owe a substantial deductible, you may want to consider applying for a personal loan to cover the costs. A personal loan is a much smarter option than financing damages with a high-interest credit card and it takes much less time to pay back a loan.
If you get into an accident with a rental vehicle and didn’t opt for the company’s insurance, you will have to file a claim with your insurance. This marks you as one of those higher risk drivers, meaning that your insurance premiums may go up.
Certain rental companies offer several types of coverage. These can include supplemental liability insurance, a personal effects protection, personal accident insurance and the loss damage waiver. Paying for these coverages up front will cost less in the long-run than taking out a loan for the damages.
To avoid any potential losses that come from a rental car accident, never loan anyone else the rental car. Only the person who signed the rental agreement should be behind the wheel. This includes family members and even valets.
Opt for the most affordable insurance the rental company offers. At the very least, you will be covered by the company.
If you have secondary coverage by putting the rental on a credit card, contact the credit card immediately after an accident. Some companies will not reimburse damages after a certain amount of time has passed.
Take the time to understand the differences in the rental company’s insurance plans. Remember, the car is someone else’s property and is on loan to you. Be a smart consumer and never be afraid to ask questions.