When you rent a car, the price you are quoted for at booking may more than quadruple at the counter because of insurance. Many consumers have complained because rental car company employees extort people causing them to buy insurance that they don’t actually need. You need to know that the rental car company is in business and they will do anything in their power to get more money from you. It is therefore wise to know your insurance needs before you get to that counter and don’t decide anything because the employee at the counter tells you that you need it. You should also read the rental car agreement carefully and ask questions about anything that you don’t understand. Here are 10 things you need to know about car insurance before you rent a car.
The Company May Sell You Insurance You Don’t Need
When you rent a car, you will be given a form and the insurance part will have boxes that they want you to tick off. The number of boxes you are required to tick off increase the amount you will pay for insurance every day. The saddest part is that you don’t actually need most of the covers in those boxes. The most important covers to get when renting a car are the Loss and Damage Waiver (LDW) also called Collision Damage Waiver (CDW) which covers damage or loss of the car, Personal Liability Waiver which covers damage you may cause to others and probably personal effects cover if you have valuable property. Most of the extra boxes are not necessary. You should also check to see if your personal insurance has comprehensive and collision cover and personal liability cover in which case you won’t need to pay for any of the rental company’s insurance.
Losses Caused By Negligence Are Not Covered
When you are on holiday, it is normal for things to get a little bit heated and many people cause accidents because of negligence. Whether you have your own personal insurance or you bought one from the rental car company, none of them will cover you if you get into an accident when driving while intoxicated. Insurance won’t pay if you packed the car illegally, gave it to an unauthorized driver or any other circumstance that point to negligence. You should therefore be careful with a rental as you would with your own car because the stakes are even higher with rentals.
Your Personal Insurance May Still Covers Rentals
This is the one thing the rental car company will not tell you when you go to the counter. They will try their best to get you to pay for their own insurance. If you have a car, then you probably have personal liability as well as comprehensive and collision cover. Both of these should be able to ver you for LGW/CDW as well as personal liability. Your homeowner and renter’s insurance should also be able to cover your items if they are stolen from the rental car. If your current policy doesn’t include rentals, you should call your insurance and have them included in which will be for a smaller fee than the daily charges levied by the car renting company.
Rental Car Company Insurance Doesn’t Cover Everything
Buying insurance from the counter doesn’t mean that you won’t have to pay out of pocket for damages to the car. You need to read the details of the agreement carefully because there are parts of the car that may be excluded from the policy. Most common exclusions include windows, tires, windscreens, undercarriages and the roof. The cover won’t work when you hit a deer or any other animal at dusk either. Some companies may give you some form of extended cover that gives you a waiver for these exclusions but they will charge you a premium for that as well.
Your Credit Card Company Could Cover You
If you are renting a car in companies where your credit card is commonly used or in your home country, you may be covered for rental car insurance if you pay for the rental with your card. You should therefore call your credit card company and ask them what policy they will cover for your car rental and what forms you may need to sign. Now the cover by the credit card company is secondary, meaning your primary insurance company will have to pay first if you have one. Credit card insurance is very useful, especially when travelling abroad where your personal insurance may not cover you.
Buying Their Insurance May Still Save You
Rental car companies don’t eel their insurance to you out of a vacuum; you may actually need their insurance. If you don’t have personal insurance or you are worried about paying higher auto insurance premiums in case something happens and you have to file a claim with your insurer. You should also consider buying liability coverage and Loss Damage Waiver in case you don’t have your own insurance or credit card insurance. It is still cheaper to buy your own rental car insurance, get an extension from your insurer or your credit card company rather than being ripped off by the rental car company.
More Drivers Mean Higher Cost Of Insurance
If you decide to pay for insurance offered by the rental car company, then be sure that the drivers you name as few as possible, preferably just one. The insurance is charged per driver per day and the more people you name as potential drivers of the car, the more the company will charge you. You will also be charged more if the driver you name is below 25 years of age.
Most Rental Car Company Insurance Are Limited
Rental car companies capitalize on your fear that your personal and credit card insurance is not enough. Now, you need to put that fear aside because in case something actually happens, it is not like they will pay much anyways. Most rental car companies only buy basic limited insurance for their cars so in case you damage someone’s car pr property or the car gets into a bad accident, they may still come after you.
The Insurance Won’t Help If You Drive on Unpaved Roads
This is one trap that has landed many people in trouble. Rental car companies usually sell people insurance and then charge them for dents and other damages that may not even exist because they drove on unpaved roads. It is usually bad because they won’t tell you that driving on unpaved roads is against their rules. If the car is damaged while you are offroading or just driving off the grid, you will have to pay for everything out of pocket.
The Rules Are Different If You Are Renting In Another Country
For people living in the US, many insurance companies have harmonized their policies to cover The US, Canada and sometimes Mexico so you may want to check. The same goes for Europe as well as Australia and New Zealand. Other countries may not be covered by your personal insurance so you have to resort to your credit card company which may also have exclusions. In some countries such as Italy, you have to buy CDW even if you have your personal insurance.
