When you rent a car, there are various types of coverage to consider. Most of these are available through the rental agency. In addition, you may already have some of the required coverage that is required through other sources.
Here are some common types of coverage typically offered by car rental companies:
Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW)
If your rental car is damaged in a collision or stolen, this insurance covers the cost of repairs. There is usually a deductible you’ll need to pay before the insurance pays its part.
Supplemental Liability Insurance (SLI) or Additional Liability Insurance (ALI)
In case you injure someone or damage someone else’s property while driving a rental car, this insurance provides additional liability coverage. If your personal auto insurance policy has low liability limits, you may want to have this coverage.
Personal Accident Insurance (PAI)
In the event of an accident, this insurance covers medical expenses for you and your passengers. Before you purchase PAI, check your existing policies to see if you already have this coverage.
Personal Effects Coverage
If personal belongings inside your rental car are lost or stolen, this insurance covers the loss or theft. Your homeowners’ or renters’ insurance may cover this, so check your policies before purchasing.
International Coverage
Check your existing insurance policies if you’re planning to rent a car. You need to know if they provide coverage where you’re renting the car or if you need to purchase additional coverage specific to that country.
If you’d prefer not to purchase coverage at the car rental counter, some alternatives may help you save money, but still provide adequate coverage.
Personal Auto Insurance Policy
Your personal auto insurance policy may extend coverage to rental cars. Coverage may include liability, collision, and comprehensive insurance. Contact your provider to understand coverage and limitations. Be aware that if you make a claim on your own auto insurance for a rental car accident, your premiums may be affected.
Credit Card Coverage
You may have a credit card that offers rental car insurance as a benefit.The coverage and conditions vary among credit card providers, so check with your credit card company to find out what they offer and under what circumstances it applies.
Travel Insurance
If you have travel insurance, it may include coverage for rental cars. Check your policy to see if it provides sufficient coverage for your needs. These policies may have limitations, so be sure to check carefully.
Membership Organizations
Some organizations, such as AAA, offer rental car discounts and insurance coverage. If you are a member of such an organization, ask about your rental car benefits.
Self-Insurance
If you have comprehensive personal auto insurance and are willing to accept some level of risk, you may choose to decline rental car insurance and self-insure for any potential damages or losses. This can be a somewhat risky option, so consider it carefully.
Rental Car Agency’s Online Booking
You can sometimes get discounted rates when you book and prepay for your rental car online. The discounted rates may apply to insurance coverage and be less expensive than purchasing it at the counter.
Bundle with Your Travel Package
If you’re booking a travel package that includes a rental car, hotel, and flights, check to see if the package includes rental car insurance as part of the deal. If so, it may save you money on insurance.
Always be sure to review the car rental agreement before you rent your car. You want to know exactly what insurance coverages are included, as well as what terms and conditions apply. If the rental agreement includes basic coverage as part of the rental fee, you may only need to consider additional coverage if necessary.
Whichever options you choose for insurance coverage, it’s important to be sure that you are sufficiently covered for your specific needs and preferences. Consider the options carefully to make the best decisions for your trip.
Roadside Assistance
This is often offered as an add-on by rental car companies. You may not need it if you already have roadside assistance service through AAA or your car manufacturer.
