If you plan on renting a car locally for just a day or two, you may not consider rental car insurance. But if you are renting a car for an extended amount of time and/or traveling over great distances, rental car insurance is a necessity. Most people when they are offered insurance on their rental refuse on the grounds that they feel they should not pay for something that they probably won't need. But for a few dollars, you could save yourself from having to pay out the nose if you are in an accident.
First of all, you don't have to buy rental car insurance from the rental company for extra money if you don't want to. You may want to, however, if the following services do not already provide it for you:
7 Y our own car insurance and homeowners' insurance
7 Your employer's insurance, if you are on a business trip
7 Y our credit card providers. Some offer insurance if you charge the rental fee on the card. Some will also cover your deductible.
7 Your automobile club memberships, such as AAA.
If your rental car is damaged upon return, you may be responsible for the deductible up to the full price of the car. A Loss Damage Waiver or LDW (also called a collision damage waiver or CDW) is something you can purchase from the rental company that releases you from responsibility any damages to the vehicle up to its full value. However, if the renter is in violation of the rental agreement, the waiver is canceled. Before you purchase one of these, check to see if your personal auto insurance doesn't already cover rentals.
This coverage usually costs around $20 per day. Many consumer protection organizations complain that LDWs are too expensive. They tend to have many loopholes as well, meaning that the company can still end up charging you for damage with or without a LDW. For example, most LDWs do not cover bodily injuries or damage to your personal property. Supplemental liability insurance (SLI, also known as additional liability insurance) is a rental car insurance option that usually pays over and above what your personal or business insurance covers. This usually costs about $10 a day. If you do not already have personal liability coverage you could purchase this from the rental agency.
Another option you can purchase is personal accident insurance (PAI).This requires a one-time payment from you that covers death or injury in an accident. Again, make sure your auto or health insurance doesn't cover this already before purchasing.
It is true that car rental insurance can seem complicated. You may not know exactly what you are paying for unless you read the fine print. Just remember that more than likely you will be covered at the minimum level. The only way you can receive all of the options above is if you pay them all; this can really add up. Most often it is not even necessary unless you have no auto insurance and plan on doing a lot of traveling. Finally, make absolutely sure that you are not already covered for this insurance before spending your hard-earned money on it.
By Kelley Caner