If you’ve ever rented a car before, you may have thought that getting rental car insurance was a superfluous step — something that you could avoid with little to no consequence. Ask anyone with a deep understanding of how insurance and compensation for car accidents works, though, and you’ll quickly learn that this isn’t always the case. As it turns out, there may be a few situations in which you’d benefit from the extra coverage. Let’s take a look at some of those variables so that you can be better informed when you make your decision.
Your Existing Insurance May Or May Not Be Enough
There’s a chance that you might already be covered for a rental car with your existing insurance, but you’ll need to check the fine print to be certain. Many car insurance policies, for instance, include liability coverage that covers medical costs and property damage when you’re at fault for an accident.
Typically, The Simple Dollar notes, liability insurance “carries over when you’re driving a rental car.” If you’re comfortable with what your current insurance covers, then, you can generally skip the supplemental liability that rental car insurance would offer. Savvy readers will note, however, that liability insurance isn’t the only type of insurance that exists for cars, and you’ll also have to take factors like comprehensive and collision coverage into account.
Comprehensive coverage insures vehicles from “non-driving related calamities,” such as the vehicle being stolen or damaged in a flood. Collision coverage aids in paying for damages that occur when you hit another car (or if another car hits you). If you don’t have these on your own vehicle, you might be on the hook in these situations with a rental vehicle, in which case passing up on rental car insurance might not be your best option.
Now, there are other kinds of insurance and benefits that might come into play as well. Some health insurance policies, for instance, might cover medical costs from a rental car accident. Travel insurance, in some cases, might have rental collision coverage, and if you’re paying for your rental with a credit card, your credit card company might offer some benefits that will help pay for certain liabilities.
Again, though, you’ll need to read up on the fine print for all these potential sources to make sure you have the coverage you need before declining rental car insurance.
A Final Note
It all depends on your individual circumstances, so be sure you know where you stand before you make a decision on rental car insurance, and remember that, while costly, the fees associated with rental car insurance are small compared to what you might have to pay from a potential car accident or lawsuit.