Buying Car Rental Insurance?

Buying Car Rental Insurance.

Don’t wait until you’re confused at the rental counter.Before your next business trip, find out if you’re covered through your own auto insurance policy or through your credit card company.Buying Rental Car Insurance.

Buying Rental Car Insurance? Don’t wait until you’re confused at the rental counter. Before your next business trip, find out if you’re covered through your own auto insurance policy or through your credit card company.

Business Use.Since the cost is for business use, take the coverage that the rental agency offers for at least two reasons: 1) If you have an accident, your insurance carrier won’t notice and therefore won’t affect your personal car policy rates. 2) It is a deductible business expense whereas your personal auto policy is not.

Car insurance.Check with your agent to find out what your car insurance policy covers when you rent a car. To be properly covered under your rental, your existing policy must cover liability, comprehensive and collision coverage for the rental vehicle.

Liability insurance protects you if you injure someone else in an accident, and comprehensive and collision insurance protects rental cars if you are responsible for the damage.

Credit card.Once you know what your car policy covers, check with your credit card company. Some credit card companies offer collision and theft insurance when you use their card to pay rent, but this coverage is usually secondary to your personal auto policy.

Significant restrictions may apply: For example, the card company may require you to refuse a collision damage waiver from the rental agent — a provision of your rental agreement that limits your liability for damage to the car. Remember, the credit card will only cover damage to the car, not a liability claim against you.

That means your credit card won’t protect you if you injure someone or damage property.In addition, this coverage may exclude business use or be limited to certain time periods and geographic areas.

Rental Insurance.If you don’t have adequate coverage through your auto insurance policy or credit card, you’ll need to purchase coverage. The most misunderstood part of rental insurance is the collision damage waiver. A collision damage waiver is not insurance; rather, it is a guarantee that the rental company will pay for certain damages.Rental agencies offer collision damage waivers or loss waivers for about $14 to $20 per day.

If you decline the collision damage waiver, you accept responsibility for all damages.The collision damage waiver also covers “lost use” – money lost to the rental agency when the vehicle cannot be rented because of the damage. In most states, auto insurance policies will not cover these costs and you may be personally responsible for them.

Also, keep in mind that the type of vehicle you purchase can greatly impact your premium. Flashy red sports cars usually cost more to insure than mid-size sedans. This also applies to vehicles that are on the most stolen list.

Also, when you damage your rental car, some agents will ask you to pay upfront a repair or replacement fee. This means the money is coming from your pocket and you will have to get reimbursed from your car insurance company. The collision damage waiver protects you from these up-front costs.

In addition to a collision damage waiver, most rental agencies offer:

• Additional liability insurance, which acts as secondary coverage for your personal policy

• Primary liability insurance for drivers who don’t have a car insurance policy or don’t want to use it • Personal accident insurance

• Personal property protection that insures your belongings

So, in the end, it depends on your situation, but carefully consider all these possibilities and most importantly, make sure you are protected!