Does Your Auto Insurance Extend to a Rental Car?
Updated: Feb 22
Traveling comes with a lot of decisions, especially during the pandemic – Fly or drive? Hotel or AirBnB? When and where? How long? Car rental? Travel Insurance? Family friendly or just adults? There are so many factors. Not to mention the stress it takes to get to your vacation- flight delays, security checks, baggage claims, airport transfers and the daunting question if whether or not you want the additional car insurance on your rental car?
Let’s make one thing a little easier- Do you need the extra car rental insurance? Know before you go and it’ll one less decision you have to think about when at the counter.
First things first- Does my car insurance cover rental cars?
It’s important to understand your policy. A typical insurance policy covers liability and any additional coverages you may have opted into such as comprehensive or collision. If these coverages are offered on your current car, there is a good chance your rental car is covered as well. It’s best to chat with your agent for your specific policy terms.
Liability Coverage will generally cover the damage you and your vehicle (rental car) caused to another person as well as any medical bills. (You don’t have any personal coverage here)
Comprehensive Coverage may help cover the damage to your vehicle (or rental car) if caused by theft, wind, fire, and natural disasters. Your deductible will apply.
Collision Coverage may help cover your vehicle (or rental car) if you are in a collision with another vehicle, or object such as a tree or animal. Your deductible will apply.
If you are paying with a credit card, some companies offer protection on a rental vehicle if there is a gap in coverage. This is something you will need to ask your credit card provider.
Rental car insurance is generally made up of few coverages:
Collision Damage Waiver (CDW) / Loss of Damage Waiver – Don’t overlook this! This waiver passes the financial responsibility back to the rental company in case of theft or damage to the rental vehicle. The agreement also passes the charges back at any time that the vehicle is being repaired or replaced- typically called “loss of use”. Make sure you get this filled out.
Personal accident insurance – As long as you have opted into Comp and Collision coverage with your Empower Agent, your current policy may cover any medical bills due to an accident that might occur while driving the rental vehicle. So again, you may not need this coverage (it’d be a duplicate)
Liability Coverage – This covers the damage caused to others. Remember, this is the minimum standard by law for a vehicle owner. If you own a vehicle there is a good chance your current auto policy will cover this on your car rental (refer above) So, this one may not be necessary.
Personal Effects Coverage – your home insurance policy may kick in if your property is stolen out of your rental vehicle. This is something you will want to confirm with your home insurance provider. You may consider adding this additional coverage depending on your home insurance.
Here are some situations in which you should definitely consider taking the rental car insurance:
If you only have the state minimum liability limits on your personal auto policy
If you carry liability only and not collision or comprehensive coverage
If you don’t currently have an active personal auto policy
If you only have a named non-owner policy
If you’re already required to carry high-risk auto insurance and should keep claims or violations to a minimum. (insurancequote.org)
Overall, you want to make sure your auto insurance extends to a rental car first prior to traveling. You don’t want to pay extra for duplicate coverages that will double the cost of your rental car. Contact your Alinsco Agent today.