When you rent a car, you will be asked if you want to buy the insurance provided by the rental car company. They will sell you coverage for collision, personal accident and liability. Most people do not take the extra coverage, but buying it at the time you rent the car may end up saving you time and money if you do have an accident. This could be true even if the coverage you have on your car covers rental car accidents.
First of all, look at your personal automobile policy or get in touch with your insurance company to find out if you have automobile rental coverage in case you have an accident. As a matter of fact, it would be a good idea to include this on a checklist of what you need before you take a trip. Currently, a lot of insurance companies restrictions or special circumstances when it comes to renting automobiles. You need to make sure you buy extra coverage if your policy does not have complete coverage or enough coverage for a rental.
There are other important gaps in coverage that often occur to the detriment of the insured. For instance, if you drive an older car, you may not be carrying any collision coverage. Therefore when you rent, your coverage could be terribly inadequate. Also, if you have entered into a long-term lease or rental agreement, some states assume (in a legal sense) that you have temporary ownership. In the advent of a car rental accident, you could be left holding the bill.
The credit card you use to secure the rental vehicle will often provide accident coverage. However this is secondary rental car collision coverage and will only reimburse you or the rental agency on an excess basis. The card company pays only after any amount due from any other agency or any other form of reimbursement has been paid. Note that no credit card provides coverage for liability.
As stated before, it may be prudent to purchase the additional coverage even if your policy covers rentals. Rental companies have standard clauses that state there is no cap or limit on your liability resulting from any use of the vehicle. When you rent a car, you are responsible for all damages regardless of fault, including physical damages, loss of use, and diminution of value and administration fees. Your primary carrier will have upper limits on what they will pay.
There is an ongoing battle between rental agencies and primary insurers with you caught in-between. In many states, law requires a vehicle owner’s private carrier to provide primary coverage in all cases. However, the primary insurer’s attorney will argue that the laws are inapplicable to rental vehicles because their business is governed by a set of statutes specific to rental cars. The insurer will only pay for the physical damages of the vehicle leaving you to pay the rest of the charges on the claim. In the courts, both sides have won. This in the end tends to indicate that being covered from all angles is probably the smartest thing you can do.
Having an accident in a car you have rented can lead to a major financial hit to your bank account. You can purchase additional coverage when you rent a car that adds extra fees, but that relatively small amount will provide extra coverage you will be glad you have if something unexpected happens to the rental car.
Shop around as needed to ensure you are working with a car rental company that meets your needs including insurance. Narrow your search to the specific city or airport you’re interested in, for example car rental Baton Rouge airport Louisiana is a service that searches across many leading suppliers.