Rental car insurance coverage is very important. Why, you ask? Well, let's say you rented a fairly new car because yours is in the shop. The company asks you about insurance, but you decline. On that rainy day, your rental car begins to slide on the slick, wet road. Suddenly, you lose control and hit a median. The car suffers extensive damage. Usually, if you have rental car insurance coverage , you would be covered. However, you're now responsible for this loaner. Damage repair will cost you thousands of dollars.
Now, what can you do to avoid this sticky situation? You need to be covered—with auto insurance, that is.
Some say auto insurance is a racket. Whether you agree or disagree, it can be a savior in times of need. When you rent a car, ask about the company's auto insurance. The insurance is not expensive and it will cover you if you should have an unfortunate accident. Another thing you can do is check with your own car insurance company. If your coverage is extensive enough, more coverage may not be necessary. However, some rental car companies may require you to still purchase insurance from their company.
There are quite a few types of rental car insurance coverage . They are (in order of relative importance):
- Collision Damage Waiver (CDW)- this type of insurance is vital to you and your pocketbook. This coverage kicks in if your rental car was either stolen or suffered significant damages due to an accident. For this insurance to kick in, you must pay a fee on a daily basis. The fee may be less than $10.
- Liability Insurance- this insurance will usually pay more than what your own insurance will. In fact, you may be insured for up to $1 million. Even though this insurance is helpful, don't look for any help if the rental car suffers severe damages.
- Personal Accident Coverage- if the accident is serious and you are hurt, this coverage will help with ensuing transportation and medical bills. If you're among the millions of people without medical insurance in the country, this insurance is great for you. It you have medical insurance it is not recommended.
- Personal Effects Coverage- if your personal belongings are misplaced or stolen from the rental car, the insurance company is responsible. You will only receive payment if you have this coverage. In order to file a claim, you must have proof of purchase. According to one website devoted to insurance, this coverage will run you a little over a buck a day. Not bad at all.
You may also be eligible for credit card rental insurance. If you get rental car insurance coverage from your plastic, you may not need collision coverage. But you need to ask your credit company for its specific guidelines regarding rental car insurance.
Now that you know the ins and outs if rental car insurance, be sure to get some type of insurance. If you think paying a daily fee is a waste of good money, wait until you get the bills for the damaged car!
By Michelle Presbury