Types of Insurance for Car Rentals
Renting a vehicle can come in handy when your current vehicle is not in good shape or when embarking on an exciting road trip. However, if you are not careful, you may end up having to pay up to $30 on top of your rental bill in the name of rental car insurance. While it is important to be protected when getting a rental car, you need to know what exactly you need in order to ensure you don't pay for additional coverage that you don't need. There are four types of insurance that rental companies will try to sell to you. They include;
1. Collision Damage Waiver
This is also referred to as Physical Damage Waiver or a Loss Damage Waiver. Collision Damage Waiver covers you if your rental vehicle is stolen or damaged. It will cost you $9 per day for vehicles worth less than $30,000 and $12 per day for vehicles worth more than $30,000. Collision Damage Waiver covers you provided the vehicle is not driven recklessly or by an unauthorized driver.
While this coverage may be important to some renters, most people usually have coverage for rental vehicles as part of their primary auto insurance. In addition, premium credit cards also provide this coverage as an incentive to renters to use the credit card to rent vehicles.
2. Supplemental Liability Protection
Also known as Supplemental Liability Insurance or Liability Insurance Supplement, this type of insurance covers you for damage to other people's property and medical costs for other people's injuries in an at-fault accident when driving a rental car. Liability insurance is a requirement in all states, so you may already have enough liability coverage through your primary auto insurance. However, since Supplemental Liability Protection usually provides $1 million in liability protection, you may buy it if you have a reason for needing more coverage for your rental car than you normally need for your own car or if you don't already have an auto insurance policy. Supplemental Liability Protection costs approximately $10.95 per day.
3. Personal Accident Insurance
This type of insurance provides medical, ambulance and death benefits to the rental car driver and the passengers in the event of an accident. The ambulance benefit is usually $150 and the medical benefit around $3,500. The death benefit is usually $17,599 for the passengers and $175,000 for the renter. Most of these benefits are duplicates of coverage you might already have under your life, health or auto insurance. They may also duplicate coverage which your rental company may already be required to provide by state laws. Personal Accident Insurance costs about $3 per day.
4. Personal Effects Coverage
This type of insurance provides coverage for theft of possessions from a rental vehicle, up to a set dollar limit. Personal Effects Coverage may duplicate coverage you already have through your homeowners insurance or tenant policy. However, you might want to consider buying Personal Effects Coverage since it pays in addition to your existing coverage; so if your possessions are stolen, your own insurance will pay first then if its policy limits are reached, your Personal Effects Coverage will also pay up to its set limits.