Rental Car Insurance: Good, Bad, Or Somewhere In-Between?
Do you dread renting a car because of the hard sell you know the clerk is going to make at point-of-sale? You know the one we’re talking about: can I interest you in the insurance? Yes, true, you may have other coverages but they only cover blah blah blah? As a consumer who doesn’t deal with insurance every day, and who doesn’t have the terms of your policy memorized, it can be tempting to bite on the technique. It’s also better to have too much protection than not enough.
However, before you say yes, you owe it to yourself and your pocketbook to learn how covered you really are while driving that rental.
To adequately answer the question of whether you should buy rental insurance — or to determine how much — much will depend on what your current protections are.
For Those With Personal Car Insurance
Good news: your standard auto insurance policy will likely be all the coverage you need. By “standard,” we mean comprehensive and collision coverage. This pays for the theft or damage to your car, no matter who is at fault. In many cases, this will transfer to the rental car as well.
As for damage or injuries that you cause to others in an accident, the liability part of your policy will handle it.
To go along with this point, Progressive managing attorney for legal operations, Mike Sablack, states that customers “have the same coverage on a rental car that they have on their own car.”
“If you have comprehensive, collision and liability coverage on your personal insurance policy, there’s a good chance that you’ll be covered in a rental car,” Sablack tells MainStreet.com. “It’s important to note that laws differ from state to state, and to be safe, consumers should ask their agent or call Progressive directly to find out.”
As part of the same report, Stacey Vogler, managing director of ProtectYourBubble.com, emphasizes that individuals should find out from their insurer if they’re covered “as soon as you can.”
“Consumers have to understand what they have in their wallet,” she says. “If you don’t know, you’re going to be more likely to pay for the upgrades the rental company is selling. They”re going to be pushy, encouraging you to get everything from additional insurance to GPS to prepaid gas. Very little of that do you actually need.”
Then again, if you have auto insurance but don’t want to risk filing a claim on your policy over a rental, the rental insurance may be a good idea, Vogler adds. “If this is a concern, the rental car coverage would keep you from having to get your auto insurance provider involved if you have an accident. Especially if you have a high deductible on your insurance policy, you may want to take the coverage offered by the rental car company so you wouldn’t have to pay the deductible.”
For Those Without Auto Insurance
For whatever reason, some of you may not have auto insurance — like if you’re not a car owner, for instance. Provided you are legally eligible to drive, you’ll want to get the fullest extent of coverage that you can. At the very least, load up on liability, which again, will protect you when you are liable for personal injury or property damage.
Insurance can be purchased through the rental company or from companies like Travel Guard and Protect Your Bubble; however, each must be bought in advance.
“The rental car company may tell you ‘Oh, we don’t accept other insurance,’ but that’s irrelevant. It’s not for them to accept — if something happens, we deal directly with our customers and reimburse them, then they pay the rental car company,” Vogler says.
For Those With A Credit Card
In an episode of Seinfeld, Jerry’s friend George wrecks his rental car. Jerry doesn’t realize that his car isn’t covered for other drivers, and so when he finds out that he’s going to be liable for the full damages, he panics and starts throwing credit cards at the clerk. “Doesn’t my credit card cover it?”
“Not that particular one,” she responds.
“Well here, I’ve got a million cards, take a card, any card!”
Jerry was out of luck. Why? Because in most cases, credit cards will only cover your collision damage if you plan on paying with that card. Furthermore, no credit card will cover liability. If you have designs on using one for coverage, check with them first. The credit card may have a traveler-friendly policy, but don’t just assume they do or you could be in a world of hurt.
Rental insurance isn’t a bad idea. It’s just sometimes redundant. But unless you know what your policy covers ahead of time, flatly refusing it may not be wise. Be an informed insurance customer, and you’ll have the protection you need.