Car rental insurance usually generates controversy among renters especially if they are already covered by one type of insurance or the other. Of course, insurance should not be seen as an avoidable cost. It can provide protection from damages, liability and financial loss. It provides you safety and security against particular events covered in the insurance policy. In case of eventuality, you will not need to pay damages through your nose if you are the cause of an accident.
Do You Need Car Rental Insurance?
To answer the question whether you need car rental insurance or not, I will like us to look at it from two different angles. We need to ensure that we understand what car rental means. Thereafter, we can then delve into the subject matter of the article which is car rental insurance.
What is car rental?
Car rental occurs when you hire a car from a car rental agency for use for a short period of time. This time can last for hours, days or weeks. People hire cars for various reasons. Some do rent cars because they don’t have a car of their own. Even if you have a car of yours, situations may make car rental to be the best option for you at a given time. For example, if you need to travel to a very distant location, it may be very strenuous driving your own car. On this note, you may travel by air while you hire a car when you arrive at your destination. At other times, your car may break down which will then necessitate that it should be fixed. Therefore, you may need to hire a car while your own car is being worked upon. It is even possible that you want to go out with certain number of people which your own car will be too small to accommodate. For this reason, you may see a reason to rent a car. Hiring a car comes with its own risks, hence the need for car rental insurance.
Who Should Buy Car Rental Insurance?
Ordinarily, I would have said that anyone that hires a car needs car rental insurance. Unfortunately, the answer is not as straight forward as that. Whether you need car rental insurance or not will depend on your situation. Let me ask you a question. Are you having any form of insurance that provides you a cover? If you are not insured in any way and you want to rent a car, then you will definitely need car rental insurance. But for people with existing auto insurance, homeowner insurance, health and personal liability insurance or if your credit card provides car rental insurance coverage, you may need to find out from your insurer or card provider to know the extent of coverage they provide. To help you decide whether you will need car rental insurance or not, you should know the types of car rental insurance that are available. In the event that your existing insurance policy already provides a coverage, you will not need to duplicate them. But if your existing insurance policy does not specifically states clearly that you enjoy the coverage, you may need to buy the car rental insurance just as to be at a safer side.
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Types of car rental insurance
Liability Coverage: This essentially provides you coverage against injuries you cause someone or any damage you cause to somebody’s property while driving. That is, it covers both bodily injury liability and property injury liability. It is possible that your auto Insurance have already covered this. However, if your auto insurance does not provide enough coverage, there may be limits to what your insurance company will pay. For instance, each State has minimum coverage limit for liability insurance coverage. If you purchased minimum coverage for bodily injury liability and property injury liability, you may need to buy supplemental liability coverage as your existing insurance may be too low. Please note that liability insurance does not cover your own injuries or damage to your property.
Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) Coverage: This is not what that can be described as insurance per se. However, it still serves as protection for you. If you get involved in an accident while driving a rental car which results to damage being done to the car or the car gets stolen, this waiver will make you escape being held responsible for the restoration of the vehicle. If you have already subscribed to collision and comprehensive insurance on your car, this policy will also cover your rental car. Collision and comprehensive insurance provide you a cover against any damage to your car as a result of crash as well as non-driving related calamities like fire, theft and vandalism. Nevertheless, if there is deductible on your policy, it will apply. In some cases, many people drop this from their car insurance policy as a result of their car getting old. For this reason, you may need to include this in your car rental insurance. You may need to pay the car rental agency other charges such as loss of income charge. The car rental company will like to charge you for the loss they must have suffered during the period the car is being repaired.
Personal Accident Insurance: If you get involved in an accident while driving rental car, personal accident insurance will cover your medical bills, ambulance and death benefits and that of your passengers. If you already have health Insurance or other insurance that provide personal injury protection, you may not need personal accident insurance as part of your car rental insurance. Also, your life insurance will ensure your death benefits in case you lost your life in the process.
Personal Effects Insurance: Your personal effects are the items you travel with. This includes items such as laptop, phones and other valuable things. If you have already purchased homeowner insurance or renter’s insurance, this will still cover your personal effects even though you are away from your home. Before you buy personal effects insurance, it is important to find out what homeowner insurance or renter’s insurance policy have already covered. If you travel with expensive items like jewelries, you may need to buy a policy that will provide you an extra coverage.
Read Also: Travel Insurance: Do you actually need it?
Another way you can save cost on car rental insurance is to take advantage of the coverage your credit card already provided. In order to enjoy the car rental insurance on your credit card, you will need to use the card to pay for the car rental. Notwithstanding, you need to understand that your credit card may only provide secondary coverage. That is, the coverage will only be applied if your car insurance is not able to cover all your costs. If you don’t have auto insurance, please ensure that you contact your card issuer to determine the extent of coverage they provide.