Car Rental Insurance

Am I already Covered?

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Taken from http://www.best-car-rental-tips.com

Should you purchase car rental insurance? This is one of the most common questions asked.

When they get to the rental counter, many renters are unsure about what to do when it comes to accepting or declining an agency's coverages and waivers. This indecision comes from not knowing what their personal or business car insurance covers while they are renting a vehicle. Many people assume that they are covered by their credit card.

As the renter you are fully responsible for any loss of or damage to the rental vehicle. This includes theft of the vehicle as well.

Before you rent a car, you should first check your existing coverages and your credit car coverages.

If you have liability insurance, you are covered, but only for liability. Liability insurance basically covers the driver and passengers but not the rental vehicle itself. If you have liability insurance, (which is required by law) then you are covered in whatever vehicle you drive, as long as it is a rare occurrence, and not part of your normal routine. This includes a rental car. Your insurance company will cover any damages you cause to anyone else (property and injury), up to your limit.

Many drivers are somewhat covered for the average rental (assuming it's for pleasure and not business). If you own a car, talk to your insurance agent. The same coverage and deductibles you carry on your car will apply, in most cases,to a vehicle you rent for pleasure. Be careful. If your policy provides skimpy coverage, you may need to compute the value of the loss or damage of a brand-new vehicle and decide if you need to supplement it.

***tip*** For example, if you decline LDW at the rental counter and rely on your own insurance, you probably would be responsible for paying your usual deductible. Also, a loss-of-use fee is not normally covered by personal auto insurance policies. And, personal auto policies that extend collision coverage to a rental car may only provide a coverage limit equal to the value of your own vehicle. If the value of your personal vehicle is less than that of the rental vehicle, you could still incur some damage responsibility.

Note: Loss of use is a fee that is charged by the rental company if your rental car is damaged and is sent out for repair. You would be billed a loss-of-use fee for every day that the vehicle was not able to be rented. That can add up!

The Loss Damage Waiver LDW) offered by the rental car company covers loss of use.

In addition, if you don't own a car or you rent cars very often, you should ask your insurance agent about buying a non-owner liability policy. It can provide ample coverage for multiple rentals and may prove to be a better bargain than the Damage Waivers offered by the rental companies.. But keep in mind, if you cause damage to your rental vehicle it will cause your regular car insurance premium to increase.

If your travel is for business, check your companys corporate travel policy to see what you are covered for in a rental car.

***Tip*** If a rental vehicle is being used to transport a group (such as a school, team, camp, etc.), the group must provide the rental car company with their own group liability insurance.

Credit Card Coverage.

Besides your personal car insurance, some credit cards will cover damage or theft to your rental car. Note:You are not covered just by being a cardholder; you must use the card to rent and pay for the vehicle.

*** Tip*** Some plans cover accidents only if the cardholder is driving, not the cardholder's spouse.

While this may replace the need for CDW (Collision Damage Waiver) and LDW (Loss Damage Waiver) offered at the car rental counter, check with your credit card company to see what kind of vehicles are covered. Credit Card coverage can vary from card to card, and it can also vary based on the issuing bank or credit company that as well.

Check to see if your credit car rental car coverage is primary or secondary. For some credit card companies, its coverage becomes primary only if you dont have any personal collision insurance of your own.

Credit card companies do not provide coverages for more expensive rentals, so it is necessary to call your credit card company to see which rental vehicles they cover. Usually they provide coverage for cars and exclude more expensive rentals such as sport utility vehicles (SUV's), luxury cars, exotic cars and vans. Credit card coverages may also not cover long-term rentals or rentals in other countries.

***Tip*** Some credit card insurance coverage specifies that you must rent from certain rental companies. Make sure to check this requirement before you reserve your car.

The bottom line is check into everything!!

If you dont need to purchase the optional coverages you will certainly save money, but only if you are truly covered.

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