Car Rental Insurance: Is It Worth It and Do You Need It?

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RentaCarNow.com is a search engine specifically for rental cars and wanted to give out a few tips for drivers to consider when renting their cars and are weighing their rental car insurance options.

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...make sure to check your policy or call your carrier to find out if you are covered while renting a car.

According to recent statistics done by RentaCarNow.com, close to one third of all consumers renting cars in the U.S. purchase additional rental insurance. And yet, whether or not drivers need extra rental insurance is the biggest point of confusion when checking in at the rental car counter. Does AMEX really cover a collision, or not? Will existing auto insurance suffice, or is it better to be safe by buying the add-on insurance?

While most consumers are trying to save as much as possible, many might hold their breath and pass on insurance to skip the extra cost. Although all car rental companies (Hertz, Avis or Enterprise) offer insurance, many consumers don't know if they really need it, or if it's an extra unnecessary expense.

Personal Auto Insurance – Each policy is different, so make sure to check your policy or call your carrier to find out if you are covered while renting a car. As a rule most personal auto insurance policies do cover car rental with the same coverage amounts. Make sure to check that your personal policy covers collision and has enough liability and if it does there is probably no need to purchase the CDW or Liability coverage offered by the Rental Car Company. However be sure to check your coverage limits because depending on the level of car you choose to rent your personal auto coverage might not cover the limits for a higher end rental car. If you do not have Personal Auto Insurance purchasing the CDW and Liability insurance from the car rental companies is a good idea.

Major Credit Cards - Many credit card companies, such as American Express, offer secondary Collision Insurance, that means that if you have a primary policy such as Personal Auto, the AMEX insurance only kicks in after the limits of your Personal Auto have expired. Also, the credit card companies car rental coverage usually only covers Collision, but not Liability and most have coverage limits around the $50,000 level. Check with your Credit Card company before renting a car so you can better understand if the card offers coverage and what the limits of the coverage are.

Summary – There are two types of Insurance the Car Rental Companies offer CDW (Collision Damage Waiver) and Personal Liability. CDW covers the damage to the cars in a collision and Personal Liability covers you the purchaser if a lawsuit is or claim occurs. Check your Personal Auto policy and your Credit Card policy before renting a car to get an understanding of what they cover. If you do not have Personal Auto insurance and your Credit Card does not provide insurance then a safe bet is to purchase a policy form the car rental company you are using.

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Benjamin Vogel

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