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Reader Question: I’m going on a trip and a rented a car, and I was wondering if my insurance will cover the rental car. The insurance they give seems like such a rip-off.
Answer: This is a great question that a lot of people ask when renting a car. It really depends on your individual insurance. Rental car insurance is usually split into four different pieces of coverage: a damage waiver, liability coverage, personal effects coverage and personal accident coverage. Here’s a breakdown of how your insurance may cover each:
Damage waiver: The damage waiver is the most expensive of the rental car insurances, and basically says that you aren’t liable for any damages to the car up to a certain amount. If you already have collision and comprehensive coverage on your car, it will carry over to the rental car, so you should be good. The only time you might want to consider taking the damage waiver is if you are renting a much more expensive car that your insurance may not completely cover.
Liability coverage: This basically cover damage to someone else’s property or injuries to that person. So if you are in an accident with another car, it would cover the other car and the people in the car if they were injured. If you already have liability coverage from your insurance company, you don’t need this.
Personal effects coverage: If the rental car is broken in to and your personal items are stolen, this would cover those items. If you don’t have anything valuable in the car or you already have your items covered by either home, renters or car insurance, then you don’t need to worry about opting in to this coverage.
Personal accident coverage: If you are injured in an accident, or anyone in your car was injured, this would cover medical bills up to a certain amount. If you already have personal injury coverage through your car insurance and have good health insurance, you can skip this coverage as well.
Keep in mind that your insurance may not cover everything, especially if you have limited coverage or your dealing with expensive cars or multiple injuries. It never hurts to opt in to these coverage plans if you would rather be safe than sorry.
Believe it or not, your credit card may come with rental car insurance. In fact, most credit cards do. If you have a Visa card, they all include rental car insurance, but only for up to 15 consecutive days of renting. If you have a MasterCard credit card, you should check with them to see if your card includes their rental car insurance, since not all of them do. MasterCard offers similar benefits to Visa, but their rental period is up to 31 days. Different credit cards may cover different things, so the best thing to do is check with your credit card issuer to see if they offer any rental car benefits and what those benefits entail before you decline rental insurance from the rental car company.