Auto Insurance For Rental Cars

Credit card and standard car insurance policies do not normally cover car rentals, and you should research and understand the dynamics of auto insurance for rental carsin order to determine if you need one. You have to verify with your insurer the limitations and exclusions of your policy before you decline the collision damage waiver (CDW) or loss damage waiver (LDW) coverage that is being offered by the car rental company.

Remember the basic rule about auto insurance for rental cars – you will assume full responsibility and liability for such events like loss and damage to the rental car. This will also include fortuitous events classified under acts of nature or God. This means that you are obligated to shoulder the expenses that arise from any damage or loss even if you are not at fault.

Coverage of Auto Insurance for Rental Cars

When you rent a car for business or pleasure, the car rental service providers will normally offer you with various options for extra coverage. These options are actually similar to standard auto insurance policies, but have distinct coverage that is unique to car rentals.

These insurance options for car renters include:

  • Loss Damage Waiver (LDW) – Strictly speaking, LDW is not your traditional auto insurance plan. It is an arrangement which “waives” any responsibility of the renter for the loss or damage to the rental car. Specific LDW packages may also apply for related expenses like loss of use due to repair, labor and towing.
  • Liability Auto Insurance – This is the standard auto insurance plan which provides cover for any liabilities associated to property damage as well as personal injury.
  • Accident Coverage – As the name implies, this auto insurance for rental cars is primarily the safety net of car renters and their passengers in case of injuries requiring immediate medical intervention.
  • Personal Effects Coverage – This type of auto insurance for rental cars provides protection to the driver of the rented car as well as the passengers in case of theft or loss of personal effects such as clothing, luggage, electronic gadgets, etc.

When Should You GetAuto Insurance for Rental Cars

When you obtain the services of a car rental company, it is imperative that you check the coverage and exclusions of your auto insurance policy and determine whether you have car rental coverage or not. Suffice it to say, you can decline any offer for auto insurance for rental cars if you already have this kind of coverage in your auto insurance policy.

Specifically, you don’t require any additional coverage for car rental if you already have both comprehensive coverage and collision that extends to rented vehicles. However, it is imperative that you have both types of coverage – collision and comprehensive – before you decline the offer for auto insurance for rental cars. On the other hand, you must get cover for liability and car loss damage waiver (LDW) if your current insurance policy does not provide coverage for rental cars. You may also consider the alternative of getting non-owner auto insurance with liability coverage.





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