Should I Purchase Rental Car Insurance?
When you rent a car from a rental car company, they will have a raft of insurance that they want to sell you. The rental car companies also make it sound as if you absolutely have to have this insurance coverage in place from them. Is it true? Do you need to have this insurance from the rental car company?
The basic answer to this is that it depends on the insurance that you have on your vehicle. When you go to rent a car it is a good idea to look over the insurance that they are offering and that they require and base your decision on your own personal vehicle insurance policy. The liability, collision and comprehensive coverage that you have on your own insurance policy will likely remain in effect with the same limits and deductibles. If you have collision, comprehensive and liability insurance on your personal vehicle, chances are you do not need to purchase rental insurance.
Some credit cards also offer additional auto insurance for rental cars, but its important that you check with your credit card company regarding the limitations, limits and specific details.
When you rent a vehicle, its important to find out what charges you could be responsible for and how these charges are covered, or aren't covered by your own insurance policy on your personal vehicle. If your personal auto insurance is sufficient to cover the charges you would be responsible for, then rental car insurance is a waste of your money. It's like paying for your insurance twice.
If you do get into a collision or require a claim to be made while you are using a rental car and the insurance you have in place doesn't cover your loss, check your other insurance policies to see if they will cover the loss. For example, some injuries may be covered by your health insurance when your car insurance policy doesn't cover it, or subsequently, if items are stolen from your rental car, they may be covered for replacement under your homeowners or rental insurance policy.
Many of the rental car companies would have you believe that your personal auto insurance isn't enough to cover the rental car, and in some cases that could be true. This is why it is important to check with your insurance company to see if the insurance you carry will transfer over to a rental vehicle. Some rental car companies will require you to purchase some additional insurance, but you may not have to purchase the full meal deal. You may want to purchase some additional insurance from the rental car company to increase your limits or add coverage that your personal auto insurance policy is lacking.
One of the points of caution is that most insurance companies will pay the claims out at the car's actual value if the vehicle is totaled in a collision. The car's actual cash value factors in mileage, age, wear and tear on the vehicle, which means that the pay out cost from your insurance will likely not cover the replacement cost of the vehicle.
Cover yourself well with insurance and ensure that you are fully covered in the event of a loss or claim needing to be filed with the rental vehicle.