Information On Rental Car Insurance
We have all experienced walking into the car rental agency wanting to rent a car. We go through the normal process of picking the right car, where we are allowed to drive but one crucial part that has most of us stumped is the insurance side of it. Most car rental agencies have multiple insurance plans which can really put the spanner in the works of someone who is simply looking for a simple insurance plan for their rental car. Of all the processes involved in renting a car, the car rental insurance is by far one of the most difficult to understand and an area where people can be easily taken advantage off. In this article we will explore the many ways that rental car insurance is used as a way for rental companies to get you to part with more cash than necessary.
In order to full understand rental car insurance, we need to know the different types that are available to us. Below we will list the commonly available coverage types.
CDW (Collision Damage Waiver), LDW (Loss Damage Waiver), PDW (Physical Damage Waiver) It is the most basic of rental car insurance coverage that you need. Basically, if you cause an accident an anything happens to the car, you don’t need to pay for the damage. There are however limitations. The limitations will be set by the policy and are normally things like mileage, distance from city or even if you were caught drunk driving.
LIS (Liability Insurance Supplement) This insurance is in addition to the one above. It will cover any third party that is involved with any accident that happens with the rental car.
PAI (Personal Accident Insurance or Coverage) This coverage option takes care of the passengers of the ill fated rental car that got into the accident. It will take care of whatever costs from the maiming that requires hospitalization.
PEC (Personal Effects Coverage) or Personal Property Insurance This coverage item looks after any belongings that could either be damaged in an accident or be stolen or lost for whatever reason.
The insurance coverage items that we have described to you above are ordered from the most basic at the top to the extras at the bottom. The most basic insurance package that individuals should drive away with are at least a combination of CDWs and LISs. This is the very minimum coverage that we consider safe. Any less and you could be in for a very messy and prolonged case if you do get into an accident.
One thing that many people don’t know is that if they have comprehensive car insurance for their car, it might even be comprehensive enough to cover the CDW and LIS needs of your rental car. What this means is you might actually be covered right from the get go from your own car insurance. This is a situation that happens more often than you think. It is however vital that you check with you current insurance provider to see if your policy extends to rental cars. Never get a rental car assuming that you already have rental car insurance from your own comprehensive coverage. There are times when your policy changes from year to year and your rental coverage may change without you knowing.
In some cases credit cards can also offer coverage for rental cars. This is especially true for higher end credit cards like “gold” or “platinum” cards made available to those who travel frequently. Most of these cards will have additional insurance coverage like personal liability, personal injury etc which can be extended over for use with rental cars. As with our recommendation with you personal car insurance, it is very important to check with your credit card provider how your insurance is structured with your credit card. Never assume you are covered. Call ahead to be sure.
We think that the best way to approach this is to first check with your current car insurance company and also your credit card company. Give them a call before you even venture to the rental car agency. There really is no point in doubling up your insurance policy as you won’t be able to make use of both. If you already have the coverage from either your car insurance provider or your credit card an overlap will simply be a waste of your money.
You should also do well to know that most car rental agencies will push you to use their insurance products. It is almost certain that they will charge you more as they know you aren’t in a position to choose when you are already at the rental car lot. It is quite normal to find that for the same coverage, the rental agencies will charge almost double the amount that you’ll find elsewhere. This is because the rental agencies act sort of like an agent for the insurance products and will often take a very large commission from the underwriters.
When it comes to rental car importance, coverage is certainly necessary. However, rental car agency coverage isn’t necessary. It will do you good to check that you aren’t already covered from other sources so you don’t double up on insurance as the rental agencies normally want you to. Check to see what insurance coverage you already have and only buy it from the rental car agencies if you don’t have the coverage and genuinely need it.
Follow Ryan Parker in his quest to demystify the world of car insurance for everyone. Not everyone thinks he is packing a full deck but he certainly provides information that is very useful. Have a look at what he has to say about rental car insurance.