So, your rental car got into a collision with another vehicle. But when you contact your car insurance company, they tell you that they don’t cover rental damages.

This news has you reeling from shock. The reality is that not many car insurance companies provide comprehensive coverage for a rental car. And even if they do, the coverage is often limited to last 30 days.

The Difference Between Auto and Rental Car Insurance

The difference between auto and rental car insurance is that auto insurance provides coverage for the car that you own. It might or might not offer protection for a rental car – that all depends on the company and policy you choose. Rental car insurance provides coverage only for the car that you will rent.

When Do You Need Rental Car Insurance?

There are many cases when you would need rental car insurance against the risk of monetary and personal loss from collision, damage, theft, or injury.

You Do Not Have Any Kind Of Insurance

Not having any kind of auto insurance is quite risky and will get you in trouble in case you are traveling abroad. Some countries or states require buying auto insurance. If you don’t own a car and have non-owner coverage then it will only cover liabilities and won’t offer any collision protection. Relying only on credit card rental insurance will be risky as well because sometimes the credit card company will only provide you secondary coverage.

Your Own Company Won’t Cover You

In case you are traveling for business purposes and rented a car but your own company won’t provide insurance coverage against any loss or damage that might occur. Then purchasing rental car insurance will be a sensible choice.

You Are Afraid of Paying The Deductible

If your auto insurance company covers collision damage to a rental car that is well and good. But, if you use your auto insurance company, you will have to pay your physical damage deductible if you have a claim. Plus, not all insurance companies will pay for loss of use to the vehicle, which may leave you on the hook for more costs. If you have rental car insurance and you get into an accident then you wouldn’t need to pay the deductible or extra costs (check the contract for the extra insurance).

You Don’t Have a Comprehensive Auto Insurance Plan

If you are prone to renting a car often for traveling abroad or on a vacation, it is better to know beforehand if your auto insurance covers your rentals or not. Because you would then need a comprehensive plan for covering all risks included in traveling overseas.

Many rental car companies have also got a minimum of coverage so if there is any damage to the car, you will be the one paying it out of your pocket.

Types of Rental Car Insurance

Before buying rental car insurance you must know its type and what will provide you the most coverage. Here we have included them:

  1. Collision damage waiver (LDW): 

It provides coverage against the harm caused to your rental car during a collision, vandalization, or theft. If you are traveling abroad where you might be unfamiliar with the traffic rules or to a particular country where auto thefts are rampant it is wise to purchase this insurance.

If you have bought this type of coverage from your regular car insurance before then it will include a deductible and might not cover the charges the rental car company is losing while their car is being repaired in the mechanic shop.

  1. Liability insurance:

It will cover damage that you might cause to another vehicle while driving. If you have auto car insurance then liability coverage will be included. But if it won’t provide you protection when you are traveling abroad in a rental car then buying a supplemental liability will benefit you in the long run.

  1. Personal accident insurance:

In case of any injury, while driving a rental car, this will cover your and your passengers’ medical bills. It also provides coverage against death in a worst-case scenario. Usually, your car insurance or rental car company already has health and life benefits included in their services. In case you don’t have any car insurance at all purchasing this coverage will be worth the cost.

  1. Personal effects coverage:

It covers the theft of your belongings that might get stolen from your car but up to a set limit. If your renters and homeowners insurance also provides coverage against theft then you don’t need to purchase this policy.

What Will It Cost You To Purchase Car Rental Insurance?

Buying rental car insurance over the counter could be pricey but you always have a choice to purchase it from third parties. Make sure to buy a comprehensive car insurance plan. The cost will depend upon your country, state, rental company and how much coverage you want to purchase. But normally, full coverage will cost you an estimate of $20 to $60 per day.