Do You Need Rental Car Insurance? How to Find Out.

Many of us have learned, the hard way, why it’s important to pay for the right kind of insurance. However, some among us may not understand. The answer to the titular question is simple. Yes, you should insure yourself. The real question is “how?” To figure out if you’re covered or not, answer the following questions.

Does my current insurance cover rentals?

Start with your car insurance policy. If you have comprehensive or collision coverage, your policy may extend to rental cars as well. Most insurance companies will also provide liability insurance if you injure somebody in an accident. If you’re covered, you don’t need to pay out of pocket.

However, keep in mind that your comprehensive insurance may be limited by the amount established for your personal car. This means that if your car is insured for $5,000 and you rent a $20,000 SUV, your policy may not cover the full cost of an accident. You need additional rental insurance if you find yourself in this situation. Check the fine print in your insurance policy contract and, if in doubt, call your agent.

Will my credit card company handle it?

If your insurance doesn’t cover rentals, check your credit cards. Most of them will pay for damages in case of an accident, but this benefit may be limited to certain rental companies, locations and time periods. You’ll also have to charge the full rental amount on your credit card, but it’s definitely worth the savings. Plan ahead and make sure your credit card will pay for damages in case of accident, as some change their policies without notifying their clients. The best way to find out if you’re eligible is to call the 800 number on the back of your credit card.

I answered “no” to both of the above questions. What now?

If you don’t have any of the options mentioned above we strongly suggest you pay for the rental car company’s insurance. The risk involved with deferring that protection is too great.

When you buy rental car insurance, you must consider several things: collision, liability, contents and life insurance, with prices ranging between $10 and $40 per day. Collision and liability coverage is essential, but the other two are optional. If you’re worried about your personal belongings being stolen out of the rental car, check your homeowner’s insurance contract. Vehicle contents may be included in your policy.

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