BEFORE heading out on summer vacation in a rental car, it's a good idea to check what insurance coverage you already have before opting to buy expensive protection at the car rental counter.
If you carry auto insurance to protect yourself and your own car, your policy probably covers you and a rental car. Of course, we are always ready at Benton White Insurance to answer any questions you might have.
You would also want to check your policy for possible limitation including any on coverage for car rentals abroad. We always recommend as a convenience to our insureds that they purchase 'rental counter coverage' when out of the US or use a credit card that covers physical damage for rental cars. (see below)
If you have dropped certain coverage - like collision or comprehensive, which covers theft and other hazards - to save money on premiums, then you will not be covered if your rental car is stolen or damaged, according to the Insurance Information Institute, an industry group.
Also, some auto insurance policies do not cover "loss of use," or revenue lost to the rental company while a rental car is being repaired, so be sure to ask about that.
If you use a credit card to pay for your rental car, you may have supplemental protection, since the major card brands often offer rental insurance. The benefit typically offers coverage for damage and theft, but it is usually secondary coverage - meaning it pays only for costs not covered by a driver's main policy. (A few cards provide primary coverage or offer it for a fee.)
CardHub.com reviewed rental car insurance coverage offered as a free benefit by Visa, American Express, MasterCard and Discover, and found some caveats.
Certain countries are often excluded from coverage - most typically, Israel, Jamaica and Ireland, the review found.
American Express excludes many popular sport utility vehicles, the analysis found. Visa does not cover accidents on dirt or gravel roads. And MasterCard has a somewhat tougher claims process, requiring the filing of more documents than the others, said Jill Gonzalez, a spokeswoman for CardHub.
There are also alternative ways in getting coverage for rental cars for travelers. Insuremyrentalcar.com offers short-term auto rental policies that provide coverage if a rental car is damaged or stolen. (The policies do not include liability coverage - protection for damages caused to other people, cars or property.) The coverage, underwritten by the Federal Insurance Company, a subsidiary of the Chubb Group, starts at about $18 for a single-trip policy.
Ernesto Suarez, the site's chief executive, said it began operating in the United States in January 2014 and now offers policies to residents of most states, except Florida, Alaska, Hawaii, Massachusetts and Vermont. With a stand-alone policy, Mr. Suarez said, a consumer does not have to make a claim under his or her own auto policy and risk an increase in premiums.
Here are some answers to other questions about rental car insurance:
â– Is coverage from my credit card automatic?
To obtain the coverage, you generally must charge the full amount of the rental on the card and decline the waiver offered by the car rental company. It's best to call the card company to get the details. Better yet, the Insurance Information Institute advises, get a written copy of the credit card's insurance policy before traveling.
â– What if I don't own a car and don't carry auto insurance?
In that case, we suggest that you should buy insurance from the car rental agency.
â– Where can I find more information about rental car insurance?
Both the National Association of Insurance Commissioners and the Insurance Information Institute offer tip sheets on their websites.
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This is a repost of a blog article first posted on the Benton White Insurance blog on 7/14/2015.