Holidays and summer vacations are often when the majority of people rent automobiles, and costs rise. Aside from higher charges, the cost of renting a car might increase much more if you need to acquire rental car insurance. You may, however, already have the coverage you require.
Your rental car may cover by your personal auto insurance
If you currently have liability or collision coverage, it will cover rental cars in the United States depending on your insurance provider (according to Josh Damico, vice president of Jerry’s insurance operations). Rental cars are frequently covered under comprehensive and collision coverage. If your car is damaged in a collision with another vehicle or object, collision insurance will fix it. Collision coverage is typically used in car accidents. Theft, fire, vandalism, and natural disasters are covered by comprehensive insurance, whereas liability insurance covers injuries.
It is best to double-check with your insurance provider because, in order to keep costs down, some firms remove rental cars from their plans. Do not get confused between rental reimbursement coverage with renting cars. If you’re engaged in a covered loss, your auto insurance rental reimbursement coverage kicks in and provides you with a rental automobile while your vehicle is being repaired. This does not apply while renting a car.
Theft of personal goods in car rentals
Any personal property stolen from your vehicle or rental car as a result of a break-in is covered by your homeowners or renters insurance. Theft of personal property is covered by homeowners and renters insurance, even if it occurs outside of your house. Your laptop will be covered by your homeowners or renters insurance if it is taken while you are at a coffee shop. Your homeowners or renters insurance will cover the theft of your laptop but not the damage or theft of your car if it was stolen from your car.
Is your rental automobile covered by your credit card?
The quick answer is that it is debatable. Credit card firms provide primary or secondary auto insurance coverage, according to Damico, but most only payout if the vehicle is destroyed or stolen. He advised that you double-check whether the coverage on the credit card you used to reserve and hire the vehicle is primary or secondary. If you don’t own a car and don’t have main auto insurance, secondary credit card coverage won’t help you, and you’ll have to get insurance from the rental business, according to Damico.
According to some credit card companies, such as Chase Freedom, “if you do not have personal automobile insurance or any other insurance, this benefit reimburses you for covered theft, damage, or administrative and loss-of-use charges imposed by the rental company, as well as reasonable towing charges that occur while you are responsible for the vehicle.” However, this does not provide liability coverage if you cause damage to another vehicle or harm its driver and passengers in an accident. Damico recommends buying non-owner auto insurance if you travel frequently and utilise rental cars. Non-owner auto insurance is essentially liability coverage for drivers who do not own an automobile.
Renting a car and purchasing rental car insurance
If you do not have main coverage through your personal auto insurance, credit card primary coverage, or non-owner automobile insurance, you must obtain insurance from the rental car provider. According to the Insurance Information Institute, the following forms of coverage may be given to you:
- “A loss-damage waiver (LDW), also known as a collision damage waiver (CDW), is not strictly an insurance product—it is designed to relieve or “waive” renters of financial liability if their rental automobile is damaged or stolen.”
- Liability coverage – Rental car firms are required by law to provide minimal liability coverage, although this is frequently insufficient.
- Personal effects coverage — protects personal belongings taken from a rented vehicle. You can decline this coverage if you have homeowners or renters insurance.
According to Damico, acquiring insurance through the rental car business can cost $10-$30 per day, and taking all three may cost more than the vehicle rental itself.
What about car-sharing services such as Zipcar or Turo?
Companies such as Zipcar provide hourly rentals of a wide range of vehicles and typically include the cost of insurance in the membership fee. According to the Zipcar website, it provides supplemental insurance coverage. Turo differs from Zipcar in that instead of automobiles being owned and managed by a company, customers hire a car from an ordinary person – similar to Airbnb for cars. Through Liberty Mutual, Turo provides third-party insurance to automobile owners (hosts). If you do not have personal auto insurance and frequently utilise car-sharing services, you should consider non-owner car insurance as your primary coverage.
The dangers of not having rental car insurance
You are responsible for any damages if you do not have personal vehicle coverage or non-owner car insurance and choose to waive insurance from the rental car business. If you are involved in an automobile accident with another vehicle, you will be liable for those losses and injuries and may face a lawsuit.