Ever rent a car and find that the $45/day Dollar quoted you online somehow turned into nearly twice that on the final bill? Make sense of rental car insurance and know whether it’s worth it!
The first step to making sure you’re not paying for anything you don’t need is knowing your own insurance policy. Stay tuned on the Reardon Insurance blog to learn more about the specifics of your policy in the following weeks!
Some of your coverage from the insurance for your car at home will carry over to your rental car. If you have Optional Bodily Injury this will apply directly to your rental car (no responsible insurance agent would sell a policy without this. When you “name your price”, sometimes important coverages like this get dropped, though….)! Additionally, your collision and comprehensive coverages will carry over as well. It is important to note, however, that these coverages carry over exactly as they appear on your personal policy if you do not purchase rental insurance—your exact deductible remains unchanged, for example.
So do I not need rental insurance then, what’s the catch?
Despite all of this basic coverage, purchasing rental insurance is recommended for these three reasons:
- You will be responsible for the loss of income to the rental company if you damage their car and they cannot rent it out. They use the rentals to make money, and they can’t make money if the car is in the shop being repaired. Your insurance will not cover loss in revenue, and the rental company essentially decides how much to charge you per day (hint: it will be well more than what you would have to pay to rent it)!
- Rental agreements require minimum coverage limits. If your personal policy is below the limits required, you will be personally responsible to pay for the difference!
- If the agreement requires 100/300 BI, and you only have 50/100, you could pay up to $200,000 out of pocket in a bad accident!
- Your policy only pays for a tow to the nearest body shop in the case of an accident. If the rental car company wants it towed back to a different location—maybe far from where your accident occurred—you may be responsible for this long haul tow!
We get it, fees are annoying, and renting a car can be expensive! But insurance is for the “what if?”, and we want to make sure you’re not on the hook for $200,000 because of opting not to pay a $30 per day fee.