Are you thinking about renting a car for your next vacation?
I’m sitting here in the Phoenix Airport getting ready to head back to Denton after attending an awesome weekend with 450 of the best and brightest Insurance Agency owners from across the country called INNOVAT18N. I’m checking my emails after a long weekend of learning and absorbing new ideas and I see one of my clients asking about coverage for rental cars. They’re heading to Vegas and wondered how their current coverage applies.
Here are the basics:
I always recommend clients buy the damage waiver from the rental car company because if anything happens:
- the claim will not show as a claim on the claims history report that all auto insurance companies have access to when determining the premiums for a new or renewal of a policy.
- Besides an accident or damage to the rental car not going on your claims record, the nice thing about the damage waiver you available with the rental car company, it basically allows you to drop off the keys and be on your business.
What about using my existing auto insurance for the rental?
The downside of using your own insurance is that there could be an instance that if the rental car company didn’t have an extra car to rent out while yours is being repaired, they could charge you the daily rental fees (loss of use) while your rental car is being repaired and most insurance companies don’t cover that cost.
If you want to use your existing auto policy for the rental car you MUST HAVE COMPREHENSIVE AND COLLISION coverage on your existing policy. If you only have liability coverage, your rental car would not be covered for the basics.
DON’T LET ANYONE DRIVE THAT IS NOT LISTED ON YOUR POLICY OR THE RENTAL AGREEMENT!
To avoid a gap in coverage, make sure any drivers of the rental car are listed on the rental agreement and are also rated drivers of your personal auto policy.
Even though you’re not required to purchase the Collision Damage Waiver from the rental car companies there are more risks involved by using your own policy. Just think about how it is drive when you’re in an unfamiliar place.
One last thing to keep in mind is that most insurance companies do not provide coverage on the vehicle itself when renting a car in a different country.
If you ever have questions, feel free to ask!