The Lowdown on Rental Car Insurance

The Lowdown on Rental Car Insurance

Have you ever wondered whether or not you actually need the car insurance offered by the rental car company? Is it necessary protection or simply a cash grab that makes you pay for coverage you already have?

The answer? It depends.

Many people aren't aware that their personal auto policy may extend to their rental car, making the daily insurance offered by the rental car company a waste of money. Sometimes this coverage is limited to personal use; if you're traveling for business, you should confirm that your rental car will be covered by your existing policy.

Here are three alternatives to expensive rental car insurance.

Comprehensive Coverage – Use your personal car insurance policy. If you have a comprehensive policy for your personal car, it is possible your coverage will extend to the rental car. Confirm your coverage before your next rental.

Rental Car Coverage – If you don't own a car or frequently rent cars for business (personal coverage may not extend to business travel), look at your policy. It may make sense for you to add rental car insurance as a separate policy or as an add-on to your existing auto coverage. All policies are different, so confirm your coverage and limitations.

Credit Card Coverage – Take advantage of built-in car rental insurance on your credit card. It's important to note that you are covered only if you pay for the entire car rental with that credit card.

Regardless of which option you choose, it's important to carefully check your policy to ensure full coverage. Possible limitations include the extra fees charged by the rental car company, other drivers not covered under your personal policy, restrictions on types of vehicles and/or travel destinations that may not be covered by your policy.