Do I need rental car insurance?

In most instances, rental car insurance overlaps with your personal auto insurance policy and you won't need to pay for duplicate coverage. There may be situations where adding rental car insurance is worthwhile, so it's important to review your personal auto coverages. If you don't have a personal auto policy, you will need to purchase liability coverage through the rental car company.

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What is rental car insurance?

Rental car insurance refers to the coverage an agency may offer you when you rent a car. This coverage may include:

  • Liability: Covers you for damages or injuries you cause while driving the rental.
  • Loss/collision damage waiver: A loss-damage waiver (or collision damage waiver) releases you from responsibility for damage that occurs to the rental car, including theft and vandalism.
  • Personal accident insurance: Personal accident coverage protects against injuries to you and your passengers while driving a rental car.
  • Personal effects coverage: Personal effects coverage covers your personal items if stolen from a rental car.

Important note: If your personal auto policy includes liability, comprehensive, collision, and medical payments/personal injury protection, then you may not need rental car insurance. If you have a homeowners, renters, or condo policy, any personal belongings you keep in a rental car should be covered too.

Rental car insurance vs. rental car reimbursement

Rental car insurance is separate coverage offered by a rental car company, whereas rental car reimbursement coverage is an optional coverage you can add to your personal auto insurance policy to help pay for rental car costs while your vehicle is being repaired after an accident.

Here's a quick overview of how your personal auto policy applies to rental cars and what to do if you don't have the coverage you need:

Does my auto insurance cover rental cars?

Your personal auto insurance will cover most rental cars with the same coverage limits and deductibles. For example, if you carry comprehensive and collision coverage on your auto policy, you'll be protected against physical damage to your rental car. Your liability coverage will also apply when you get behind the wheel of your rental.

Do you need car insurance to rent a car?

You don't need a personal auto policy to rent a car. If you don't have a personal policy, you'll be required to buy liability coverage through the rental car company. You will also have the option to add additional coverages, including collision and tire damage.

Does my credit card provide rental car insurance?

Some credit card companies provide insurance coverage if you use your card to pay for the rental car. Check with your credit card company for specific coverage information, rules, and restrictions.

Should I get rental car insurance?

If you already have car insurance or rental car coverage through your credit card, then rental car insurance may not be worthwhile. There are a few instances, however, where adding rental car insurance could be beneficial and worth considering:

  • You have high deductibles on your auto policy: Rental car insurance coverage often carries no or low deductibles, so you could pay much less or nothing out of pocket on a claim vs. a high deductible with your personal auto policy.
  • You want to avoid claims on your auto policy: With rental car insurance, you would file a claim with the rental car company, which avoids a potential rate increase on your personal auto policy.
  • You don't carry comp or collision coverage: If you don't carry comprehensive or collision coverage on your personal auto policy, adding a loss-damage waiver can protect you against physical damage to your rental car.
  • You carry a low liability coverage limit: If you carry the state minimum liability limit on your auto policy, adding additional coverage from the rental company will offer greater protection if you're involved in an at-fault accident.
  • You're traveling: Most U.S. auto policies only provide coverage in the U.S. and Canada. If you're traveling to a country where your auto policy doesn't provide coverage, then rental car insurance may be essential.

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