Things You Need To Know About Rental Car Insurance
Most of us have been there before. We make all the proper arrangements for our trip, which sites to visit, booked the hotel with the right room package. We even have picked just the right car for that road trip that we need to rent. When the days comes everything seem to work out just fine until you set foot in the car rental agency wanting to pick up the keys to that rental car. When the final bill comes and we have picked the most comprehensive insurance package, we are shocked that the price of the rental car suddenly doubled. Looking through the details, you find that it is the car insurance that is doubling the rental costs. It is quite normal for people to get very aggravated and even shocked that something like the insurance for their rental car can cost so much. In this article it is our hope that we can bring to light some common ways to first arrest the rental car insurance costs and also to look at ways to reduce them substantially.
In order to full understand rental car insurance, we need to know the different types that are available to us. Below we will list the commonly available coverage types.
CDW (Collision Damage Waiver), LDW (Loss Damage Waiver), PDW (Physical Damage Waiver) It is the most basic of rental car insurance coverage that you need. Basically, if you cause an accident an anything happens to the car, you don’t need to pay for the damage. There are however limitations. The limitations will be set by the policy and are normally things like mileage, distance from city or even if you were caught drunk driving.
LIS (Liability Insurance Supplement) It is a little something extra on top of the basic coverage that you have on top. This may come in many forms but mostly to cover any other eventualities that might have occurred if there are many third parties involved in the accident.
PAI (Personal Accident Insurance or Coverage) This coverage is also in addition to whatever is above and covers the passengers and whatever damage or maiming requiring hospitalization.
PEC (Personal Effects Coverage) or Personal Property Insurance This is the least important of all the coverage options that we have listed above. It covers whatever personal belongings that you have in the rental car if it should be lost in an accident of a break-in.
Above we have listed the standard rental car insurance coverage from the most basic at the top to the extras at the bottom. Generally, the most basic coverage items that you must have are a combination of CDWs and LISs. This will basically cover you from any damage that you do if you were in an accident but minus whatever costs incurred to you, your passengers and your belongings.
One thing that many people don’t know is that if they have comprehensive car insurance for their car, it might even be comprehensive enough to cover the CDW and LIS needs of your rental car. What this means is you might actually be covered right from the get go from your own car insurance. This is a situation that happens more often than you think. It is however vital that you check with you current insurance provider to see if your policy extends to rental cars. Never get a rental car assuming that you already have rental car insurance from your own comprehensive coverage. There are times when your policy changes from year to year and your rental coverage may change without you knowing.
In some cases credit cards can also offer coverage for rental cars. This is especially true for higher end credit cards like “gold” or “platinum” cards made available to those who travel frequently. Most of these cards will have additional insurance coverage like personal liability, personal injury etc which can be extended over for use with rental cars. As with our recommendation with you personal car insurance, it is very important to check with your credit card provider how your insurance is structured with your credit card. Never assume you are covered. Call ahead to be sure.
It is only after you check with both your current car insurance provider and your credit card should you even think of purchasing the rental car insurance from the rental company. Naturally, if you do it the other way around you could very well be wasting money with double coverage. The coverage that you buy at the rental agency could very well overlap the coverage that you already have with your current comprehensive insurance or your credit card.
It should also be noted that if you opt to get insurance from the rental car agency that it will actually cost more than what you can get from your own car insurance company or as provided by the credit card. It isn’t abnormal to find that rental car agencies will charge almost double for the insurance coverage. This is a part of their profit model to catch customers with no insurance so they are forced to get it or not get the rental car.
Here is a pretty got saying for you to go with. It is necessary to get rental car insurance however it isn’t necessary to get it from your rental car agency. This rings so true most of the time. Insurance policies from rental car agencies are often very expensive and sometimes you might already have the coverage from other sources like your comprehensive car insurance policy of your credit card. Always check first so you don’t end up paying more than you should.
Follow Ryan Parker in his quest to demystify the world of car insurance for everyone. Not everyone thinks he is packing a full deck but he certainly provides information that is very useful. Have a look at what he has to say about rental car insurance.
