For most people in the United States, or at least those with car insurance, it is known that if you have car insurance, then that insurance will in most cases extend to cover you if you want to rent a car.
If you do not have your own car insurance but you need to rent a car, you may wonder if you are allowed to rent a car without car insurance. Rest assured, it is possible to rent a car if you do not already have car insurance.
In fact, your situation is so common that most car rental companies actually offer their own insurance for your rental car. So, don’t let your lack of personal car insurance stop you from planning your car rental.
You may be surprised to learn that rental cars are already insured, and it’s pretty intuitive if you think about it. The rental cars available from the rental car company are expensive assets that are pricey to replace, repair, and maintain. As with most assets, you would want to protect yourself from asset losses, and your car rental company is no different.
Now, rental cars are insured, but it is typically the bare minimum insurance required. Your rental car company will offer you supplemental insurance to add to the insurance the car already has so that you can protect yourself from responsibility in the event of an accident.
If you have your own personal car insurance and it carries over to cover your rental, it would not make much sense to purchase additional supplemental insurance policies because it costs money that you don’t have to spend. It can actually cost you up to about $40 more per day, so if you don’t need it, don’t get it, right?
However, if you don’t already have insurance, you definitely want to consider your supplemental insurance options when you rent a car. Before you decide, ask yourself three questions about supplemental insurance.
Three Factors to Consider Before You Buy Rental Car Insurance
What does the rental car insurance cover?
As mentioned above, rental car companies’ cars are already insured. Most companies only offer automatic insurance that meets the minimum requirements in the state where they are located. Every company is different though, so you will want to ask. Something else to consider is that if you are going to drop off in another state, your insurance will need to meet the requirements in the state you are traveling to as well.
Insurance requirements may differ from state to state, but every state in the United States has a minimum car insurance requirement.
Does another policy I have already cover me?
You may not have car insurance for yourself, but if you live with your family, another family member’s policy may cover you already. So you will want to ask in order to possibly save you an unnecessary expense.
If you have health insurance already, like through your job or from a family member, It is likely that you already have medical insurance in this case that will cover you if you are injured in an accident. So, again, you’ll want to see if you are covered some other way before you add any additional insurance coverage.
Lastly, if you travel a lot, you may have travel insurance which could cover your car rental and would also offer you coverage as you – you guessed it – travel.
Will my credit card cover me with rental car insurance?
It is likely that you are already using a credit card to secure and/or pay for your car rental, but did you know that many credit cards provide or at least offer car rental insurance as an added perk for their cardholders? In order to put that perk to use, you have to use that card for your rental car purchase. If you are unsure if your card offers this coverage, you will want to call and ask. Make sure when you find out that they offer this insurance to have them spell out for you what the coverage includes and what are the coverage’s limitations and exclusions for the card.
Remember that insurance is there to take the burden of responsibility off of you. This responsibility unburdening means that in the event of an accident the insurance company will step in and bear the brunt. It is often uncomfortable to think about and plan for, but insurance is for accidents, the unforeseen, the unfortunate, and the untimely.
You can’t protect yourself against what you don’t know is coming, and it is unlikely that the car rental insurance that comes standard with your rental is going to be enough to help you if you end up in a tough situation because of an accident.
If you’re protected by insurance you already have and you know that after asking yourself the questions above, then it is easy to move forward with confidence and get on your way in your rental car.
However, if you have asked yourself these questions and you have decided that you definitely still need additional insurance, there are typically four types of supplemental insurance available to you from your rental company.
Four Types of Rental Car Coverage
1 – Collision Damage Waivers
These waivers cover damages to the car in the event of an accident. This is important because without it, if something happens to the car while you are renting it, you will be financially responsible for repairing or replacing it. This is occasionally part of the automatic insurance and factored into the cost of the rental, so be sure to ask your rental company.
2 – Supplemental Liability Insurance
Supplemental liability insurance covers other people in wrecks in which you are ruled to be at fault. Most states require liability insurance of some kind, but you may want to consider additional supplemental liability insurance coverage in order to have a lower deductible in the event of an accident.
3 – Personal Accident Insurance
Personal accident insurance works similarly to supplemental liability insurance in the kinds of things it covers, but instead of covering other people in the event of an accident, it covers you and your passengers in the event of an accident. As mentioned previously, any medical insurance you already have may cover you, so this may be a needless addition to your insurance coverage.
One thing to keep in mind though is that your personal accident insurance would kick in when the coverage you have from medical insurance drops off. So, while you may be covered, you might want to consider the additional protection if you can afford it. A little extra for the trip may save you thousands or more later.
4 – Personal Effects Coverage
Personal effects coverage protects you and your stuff in case your items are stolen from the rental vehicle. You will be reimbursed for your items if you lose them this way.
This coverage and protection is nice if you know you will have valuable property in your rental car. If you know it is just going to be you and the wallet you keep on your person in the vehicle, this coverage may not be for you.
In all likelihood, the liability-only insurance just will not be enough protection to safely cover you and your rental if you have the unfortunate experience of having your rental car damaged while it is in your care. A combination of liability and collision coverage is the best answer to give you the peace of mind that having the right amount of insurance can provide you.
If you have medical insurance and so do your passengers, then personal accident insurance is more of an option than a necessity. Check your policy and get a census from your passengers to determine what’s best for you and your group.
As mentioned above, the personal effects coverage is subjective to your situation and your level of concern that your things could be stolen. Even if you choose to have the personal effects coverage, it is never advisable to leave valuable items unattended in any vehicle if it can be avoided.
Summary
As you can see, it is entirely possible to rent a vehicle if you do not already have car insurance. However, whether you have car insurance already or not, you will want to make sure you are covered either way for the duration of your rental.
Will you buy rental car insurance from the car rental company you are using? Are you already covered by your health insurance, your homeowners’ policy, or your family’s policy? Are you going to take advantage of the insurance benefit your credit card offers? Whatever you choose, just make sure you’re covered.
If you don’t know if you’re covered or what is covered, don’t be afraid to ask questions and make phone calls until you get answers. The whole point of insurance is to give you peace of mind and protect you when life happens. Do what you need to do and what you feel comfortable with, so you can get on the road and enjoy your trip.
Sources:
https://www.nerdwallet.com/article/insurance/minimum-car-insurance-requirements
https://www.collinsdictionary.com/us/dictionary/english/travel-insurance
