Do you need to take out additional rental car insurance? Your options explained – Jalopnik

Um, the upsell. No one likes to be sold, especially when you’re standing at the car rental counter trying to get on with your vacation. Maybe you chose that rental company because you saw the ad for the special daily rate of $29, and now the rental agent is trying to convince you to add $40 a day for insurance, on top of a bunch of other rental car costs. It can also make them aggressive. Rental agents tried to convince us that we should take out their insurance, even though we could prove that we were fully covered by our personal insurance. This pushiness could be why so many customers decline their insurance.

But don’t let the aggressive upsell irritate you so much that you immediately reject the extra insurance. There may be times when you need it. For example, do you only have liability coverage with your private insurance? Then the rental car itself is not covered, just like your own car would not be. Or maybe you have collision coverage on your 1993 Geo Metro, but you decided to rent a Lambo to cruise around Miami Beach. You can be almost certain that your personal insurance will not be sufficient. Can you afford your personal insurance deductible if you add the rent? Then you may need additional rental insurance. The same applies, of course, if you are not insured at all.

If your personal insurance covers all of these things, then you’re set. Another option is to use a credit card that covers rental damages, but be sure to check exactly what it covers. You even have options within the rental company’s policy. You may only be able to choose policies that fill the gaps left by your own insurance.

So you rented a new Ferrari for the day to make your social media followers think that you are really successful and that they should definitely buy your online course on how to get rich. Who hasn’t been there? However, the insurance you have for your 2006 Honda Civic won’t cover the Ferrari, and you’d have to sell a lot of courses to cover it if something were to happen to it.

Another case where you need the extra insurance is if your personal insurance only covers liability. This only covers damage you cause to other people’s vehicles or property, not damage to your rental car. (Sometimes car rental companies surprise you with damage claims.) Or maybe you have a collision in addition to liability. If that policy has a high deductible, you may want to consider the additional insurance. Or perhaps the only personal coverage you have is through your credit card, which likely won’t cover liability. Then you may be able to waive the rental company’s collision policy and assume only its liability, which is usually not very expensive. Also keep in mind that your personal insurance may not cover RV rentals, business rentals, or rentals longer than 15 days.

You also want to be covered for ‘loss of use’. If your rental car is damaged, it will take some time to get it repaired and the rental company will no longer be able to use the car. Companies typically compensate for this loss of revenue by charging for “loss of use,” something not covered by most personal or credit card coverage.

You do not always need extra insurance from the car rental company. For example, if you have collision and liability coverage between your credit card and your personal insurance, you may not need it. You may be able to pay your own insurance deductible, which will cover anything that might happen to your rental car. You even have coverage that covers “loss of use.” Then you are worth gold.

In addition to offering liability coverage and a collision waiver, the company can also offer personal property coverage. Unless you are transporting goods that are very valuable, you may not need this. The other type of coverage that rental companies provide is for personal injury, which covers damage and hospitalization that your actions caused to yourself and others. But this is probably covered by your liability insurance, in case of what you have done to others. Your own health insurance or personal injury policy may cover your own situation, if you have either.

There are other ways to save on car rentals besides skimping on insurance (like renting your car through Costco). But it all comes down to having insurance. Please note that the rental company will hold you responsible for any damage to the vehicle during your rental period, whether or not you are at fault. So make sure you read the fine print of whatever coverage you have, whether it’s your own personal coverage, your credit card coverage, or the rental company’s coverage.