WHICH INSURANCE MOST CAR RENTERS CAN OPT OUT
Deciding whether to sign up for insurance at the car rental counter can be confusing. No one wants to be stuck with a big bill after an accident. But spending $ 20 or more each day for protection can be a waste of money. If you do a little legwork before
LOSS DAMAGE WAIVER, YES OR NO?
If you damage the vehicle, you have to pay for the repairs. You’ll also be on the hook for the earnings the company misses out on while the car is in the shop. Rental companies will try to sell you a loss damage waiver for those losses. There’s a good chance you don’t need to buy it. How to tell: uCheck your current car insurance policy. According to GEICO, “If you’re renting a car of similar value to your personal car, in all likelihood the insurance coverages will be adequate for the rental.” Pay attention to the coverage limits, especially if you are renting a vehicle more expensive than the one you own. uNext, check to see if your credit
card offers a rental car benefit. Most cards offer secondary insurance, which means you have to make a claim to your primary insurer first. The card typically picks up where that coverage stops. For example, your card could cover your deductible. Many primary auto policies may not cover loss of use or rental car administrative fees, which can make the credit card policy especially valuable. uConsider your credit card
choices. If you rent cars often, you might want a card that offers primary insurance. You can find a list of such cards at MileCards or ThePointsGuy. With these cards you can avoid the risk of a car insurance premium hike. And it makes the claims process much less painful.
uWatch out for exclusions. Read the fine print of both your insurance and your credit card policies. Many don’t cover business rentals. In addition, overseas travel can be a problem. For example, Ireland, Israel and Jamaica are often excluded. And think twice before getting excited and renting a luxury vehicle. You will often give up insurance protection if you do.
uThe bottom line. If you have a credit card that offers primary auto insurance, you can turn down the loss damage waiver as long as you make the reservation and pay with that card. If your primary auto insurance covers rentals, you should still consider using a credit card that offers secondary insurance for the most protection. Only if you don’t have sufficient primary auto insurance coverage or don’t have a credit card with a car rental benefit would you want to buy the loss damage waiver.
ADDITIONAL LIABILITY INSURANCE
If you are at fault in a wreck, you could be held responsible for the damages to someone’s property as well as their medical bills. These liabilities could be significant ... but if you already have car insurance, you’re probably covered.
uWhat to watch out for. Check with your primary insurer and make sure your liability coverage extends to rentals.
uThe bottom line. If you don’t have auto insurance, you will want to protect yourself against third- party liabilities. If you don’t rent cars often, you might want to take the car rental company up on its liability coverage. If you are a frequent renter, consider buying a non- owner car insurance policy.
PERSONAL EFFECTS INSURANCE
Anything you keep in your rental car could be lost, stolen or destroyed. Car rental companies want to sell you insurance to protect your possessions. For most people, this type of insurance just isn’t necessary. If you have a homeowners or renters policy, you’re most likely already covered.
uThe bottom line. Usually, the answer to this question is no.
PERSONAL ACCIDENT INSURANCE
Car rental companies frequently sell medical insurance as well as life insurance, but it’s generally a bad idea to buy them. Your own health insurance should cover you. If you’re going overseas, call to make sure your policy works there. If it doesn’t, the State Department has a list of travel insurance companies.
uThe bottom line. Usually, the answer to this question is no.
uThe final word on car rental insurance. Don’t wait until you get to the rental car counter to think about it, or you will probably end up paying too much. For most people, a combination of their primary auto insurance and credit card will be enough to stay protected.