Should I buy rental car insurance coverage?


It is debatable whether buying insurance from the rental company is a good idea. While some agents strongly recommend it, since it provides some liability protection, others claim that it is not worth spending almost double the rental price to get coverage that is full of restrictions.

Drawbacks of the Rental Auto Insurance Coverage

One very serious disadvantage of the collision damage waiver (CDW) offered in car rental contracts is its cost - few people can afford to pay an additional $10, $20 a day or sometimes even more for renting a car.

It is especially unaffordable when you rent an automobile for longer periods of time. Imagine you want to rent an auto for six months and you do buy the collision damage waiver - you will have to pay a minimum of $1800, and that is not even including the rental fees. In comparison, if you had insurance for damage to your auto, you would have to pay roughly between $200 and $300 for the six-month rental period.

The rental car insurance coverage has numerous restrictions, i.e. it gives you no guarantee that you won't be held liable in certain situations. These include unlisted drivers, driving under the influence (even if you have only had a drink!), speeding and even driving outside the area permitted by the contract.

When to Buy Rental Car Insurance

Insurance specialists usually recommend that you purchase the car rental CDW only if your Personal Auto policy (PAP) does not have the collision and the comprehensive coverage, both of which apply to any vehicle you drive.

Still, it is sometimes worth getting extra rental auto coverage even if you have collision and comprehensive protection included in your policy. If you are found to be at fault in an accident while driving a rental car, your PAP will cover the damages. However, as a result of the claims, your premiums will soar and you even risk losing your policy altogether. Not if you have rental car insurance.

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