Renting A Car? What You DON'T Know Can Hurt You!

Do I really need rental car insurance?  What does my current policy cover?

These are two of the more frequently asked questions I receive from my auto insurance clients. Probably because properly insuring a rental car can be confusing and frustrating at times.  Many rental agencies offer “damage waivers” for anywhere from $15-$25 a day (selling peace of mind along with extended coverage’s). Here are a few tips about Collision Damage Waiver(s) also known as Loss Damage Waivers to make your experience a little easier and less costly:

·         A Collision/Loss Damage Waiver is NOT an insurance product; however it “waives” the renter of financial responsibility if the rental car is damaged or stolen. So in other words, if you chose not to select this option you (the customer) must pay the rental company the full cost of repair, lost revenue, plus administrative charges.  

·         In most cases waivers provide coverage for administrative fees such as “loss of use” (the cost/money the rental car company loses by not being able to rent a damaged vehicle while it’s being repaired) and “diminished value” (the amount a rental vehicle’s resale value goes down/diminishes due to a damage caused by you). DEPENDING ON THE INSURANCE COMPANY INSURING YOUR VEHICLE YOU MAY HAVE ONE, BOTH OR NEITHER OF THESE COVERAGE’S AS PART OF YOUR POLICY OR YOU MAY BE ABLE TO HAVE THEM ADDED BUT YOU WON’T KNOW UNLESS YOU CALL. 

·         Often time’s waivers become void if the accident was caused by speeding, driving on unpaved roads or driving while intoxicated. This could leave you (the customer) being completely, financially responsible.

BEFORE renting a car please make sure you make at least two very important calls!

1.  CALL YOUR INSURANCE AGENT - to verify you are not duplicating coverage. Your current liability coverage, collision and comprehensive deductibles may apply when renting a car. However, you may still have some gaps so it is always best to call your agent.
2. CALL THE CREDIT CARD COMPANY you will be using to rent the car. Insurance benefits offered by a credit card company differ by the company, the level of credit card being used, as well as a host of other possible criteria.  Credit card companies may cover only damage or loss of a rented car, not for other vehicles involved or personal belongings or may not provide any coverage at all.

If you plan on renting a car in another country, contact your insurance agent and your travel agent to find out what you need to do to be properly insured.  If you are renting a car abroad, you may also need an international driver’s license.

As with all insurance products it’s better to be safe than sorry and to know how you’re covered BEFORE a loss occurs. That’s another valuable reason to find an independent agent today. We’re here when you call!

-Amanda Ray