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Straight Facts on Rental Car Coverage

rc-2Travel often involves renting a car, so before you depart for your next trip be sure to check with your insurance agent to find out the facts about rental car coverage.  Ask about your homeowners or renters insurance too because you may not have coverage for personal property that could be stolen from a rental car.

At the rental car counter you’ll be asked if you want to include rental car coverage so you’ll want to be prepared to make the best choice.

The clerk at the counter wants you to accept the coverage because it’s a profit center for the company.  However, for many travelers the additional coverage is a waste of money.

80% of All Drivers Overpay for Insurance. Do You? Start Saving Now. That’s because the coverage you have purchased on your own car will cover the rental car, too.  There are some situations where you would want to buy coverage from the rental car company.  If you drive an older car and don’t currently carry comprehensive and collision, consider accepting the rental car policy to add that coverage.

When you use a credit card to pay for a rental car, your card may offer coverage.  The coverage differs widely by issuer, and by the type of card.  If you have several cards, it pays to spend a few minutes researching the benefits you already have available.

In most cases, the coverage offered by your credit card will be secondary.  That means your personal auto policy will pay first, then the credit card policy picks up charges over the limits.  This may include coverage for your deductible, towing and other charges.  Be sure to read the fine print in the credit card contract and make sure you comply with all requirements of the coverage.  One of those is that you pay the entire cost of the rental with the card.

Be aware that if you do have an accident in a rental car, you may be charged a variety of fees that aren’t covered by either your primary policy or the credit card.  Increasingly, car rental companies charge loss of use fees when a customer wrecks a car and makes it unavailable for service.  There may be administrative fees as well.

As a general rule, you won’t really need the policy offered by the rental car company.  It rarely offers value equal to the cost.  A better option is to make sure that your own auto policy has the best combination of coverage, limits and deductibles whether at home or away.

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