Do I Need Rental Car Insurance?

A man holds a key with a keychain shaped like a car beside the words "Rental Car Insurance"

When you plan a long trip, you may decide to take a rental car instead of your own car or the bus. In other cases, you may need a rental car because your car got damaged in a wreck and it needs to stay in the shop for a few days. In either of these cases, it’s easy to get so caught up in the chaos that you don’t even think about rental car insurance. But do you really need it?

The short answer is: it depends. This information can help you determine whether or not you need to get rental car coverage.

Doesn’t my Car Insurance Cover Rental Cars?

You should never just assume that your car insurance covers rental cars. Oftentimes it will, but it’s a good idea to check with your insurance company before getting behind the wheel of a rental car for the first time. Sometimes rental car insurance is an extra feature or completely separate coverage that you need to opt in for. You can get additional rental car coverage from the rental car company itself, but make sure to check their coverages against your existing car insurance to make sure that you’re not paying for the same coverage twice.

Even if your car insurance does cover rental cars, you may need additional coverage. This is especially the case if you’re renting a car that is of a much higher value than your current vehicle. Coverage for a 2005 Toyota Camry will not be sufficient to cover a rented 2018 Ford Mustang.

There are also a number of other coverage options that rental car companies offer that you may want to opt in for. Below is a break down of what your current car insurance company likely covers and what the rental car company may offer you.

Car Insurance Company’s Coverage of Rental Cars

  • Liability Car Insurance. This covers any injuries that you cause another driver or passenger and any damage you cause to another person’s property. Liability car insurance is required for all drivers, so you will not need complete coverage from the rental car company – you’ll need some supplemental coverage at most. You may want extra protection for the rental car, or the rental car company may have a minimum for liability car insurance coverage before they’ll rent you a car. In either case, you can either increase your coverage with your current insurance company or take additional coverage from the rental car company.

  • Other Than Collision (OTC) Coverage. Other Than Collision covers any car damage that you could not prevent, such as damage caused by falling tree limbs or hail damage (often referred to as “acts of God”). It can also cover theft.

  • Collision Coverage. This covers the cost of repairs or replacement to your own car should you crash your personal vehicle or rental car.

  • Personal Injury Protection. If you or a passenger gets injured in a rental car accident, personal injury protection will help pay for medical bills. There is also a similar coverage known simply as Medical Payments, so make sure to ask if you have one or the other before adding additional coverage.

  • Personal Belongings. This is usually covered by any homeowners or renters insurance. This coverage applies to cars in the case of theft of personal belongings from your car. Personal belongings are only covered by homeowners/rental insurance; you cannot add this coverage to your auto insurance.

Supplemental Insurance Offered by Rental Car Company

  • Supplemental Liability. As mentioned above, you have the option of adding additional liability car insurance through the rental car company. This is for when you just want a temporary increase in protection.

  • Loss Damage Waiver. Also known as a Collision Damage Waiver, this coverage is a good idea if you don’t currently have comprehensive or collision coverage. This waiver essentially transfers responsibility to the car rental company if the car is damaged or stolen. Accepting this coverage from the rental company also keeps your personal insurance from paying for repairs for damages you may have caused.

  • Personal Effects. If you don’t have homeowners or renters insurance, you may want to add this coverage so that you’ll get reimbursed for any personal items stolen from the rental car.

  • Personal Accident Insurance. If you don’t have personal injury protection, you can opt for this coverage, which pays for medical bills incurred by car accidents.

Additional Coverage Option

There is also one more place to check with before opting for insurance from the rental car company: your credit card company. Some credit card companies have the added benefit of rental car insurance included, or they may offer this coverage at a better rate than the rental car company does.

The credit card company will of course require you to pay for the rental car with the card that you got from them. Make sure to check if they offer primary or secondary coverage. Secondary coverage only covers your deductible and other claim costs, so you may still decide that you want more coverage than your auto policy and credit card company offer.

If you want an auto insurance company that will help you understand your coverage options and that is honest about what coverage you do and don’t need, contact Schertz Insurance today. They are dedicated to remaining one of the most trustworthy insurance companies in Denton County and surrounding areas.