Car Rental Insurance

Should I get their Insurance or will my insurance cover me?

Imagine this. You're on vacation, cruising down the open road, sightseeing, soaking up the sun, and the unthinkable occurs. Within seconds, you find yourself involved in a terrible car accident. However, that's not the worst part. The car you were driving just so happens to be a rental car. What do you do now? In most cases, you already have your own car insurance if you own a vehicle. This insurance should have been required at the time of your car rental transaction, which will substitute as your car rental insurance. However, you want to be absolutely sure that you have the proper insurance for your rental that includes collision coverage, which pays for damages to your vehicle from accidents involving other cars or objects. If your current policy already includes collision coverage, then getting insurance from the rental company is redundant and a waste of money. Without this coverage, you will need to purchase rental car insurance.

Purchasing insurance from the rental company can however be very beneficial. Not only does it protect you from expenses due to damages from the vehicle, but depending on the plan you choose, it's very inexpensive compared to what your out-of-pocket expenses would be in the event that you do get into a car accident and have no insurance coverage. On average, collision damage can cost as much as $19 per day and shifts liability for collision damage from the person renting the car to the car rental company. Liability insurance, which provides protection for up to $1 million, costs between $7 and $14 a day. Again, if you already have an insurance policy, then your premium should include liability insurance. You can also purchase personal accident insurance, which covers medical expenses for the parties involved in the accident.

However, be clear that not every rental company is a licensed insurance agent, therefore what you are purchasing may not necessarily be insurance, but more so a protection package. By law, these rental companies are required to offer you the minimum liability coverage, however depending on how extensive the accident is, minimum liability coverage is not going to do much on your behalf.

So as you can see, there really is no set answer on whether or not you should purchase car rental insurance, however in order to operate any vehicle, you must be equipped with some form of insurance coverage, so if you do not have your own, then it is in your best interest to purchase an insurance policy through the rental company.

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