Does My Auto Insurance Policy Cover Rental Cars?

One of the most common questions asked by individuals who have auto insurance is whether or not rental cars are covered as a part of their policy. It is important to know whether the vehicle you are renting will be covered by your Massachusetts car insurance policy or if you need to purchase insurance from the rental company. Rental car insurance can be confusing and as a result, many people will either get it – even if they don’t need it; and others will pass it up – even if they should have it.

Rental Care Coverage

Before you can fully understand whether or not rental cars are covered under your policy, it is important to know about the four different types of rental car insurance that are available.

• Loss Damage Waiver/Collision Damage Waiver
  This type of insurance will cover you if the rental car is stolen or damaged. If you already have an auto insurance policy or your credit card company covers rental vehicles, you probably won’t need to purchase this type of insurance from the rental company (always check with your insurance company though). It is important to note that some rental companies will charge you additional fees if there is an accident – even if you aren’t at fault – but your Loss or Collision Damage Waiver may cover these fees completely.
• Liability/Non-Owner Liability
  If you are in an accident with your rental car, a liability insurance policy will protect you from most law suits. In many cases, this type of insurance is already included in with your regular auto insurance policy, so make sure to ask specifically about this type of coverage before purchasing more. A Non-Owner Liability policy is great for people who frequently rent vehicles, but don’t own a vehicle of their own, thereby negating the need for a regular auto insurance policy. It will give you extra protection every time you rent a vehicle or borrow a friend’s vehicle. This Non-Owner coverage is available to be added on commercial auto policies if you do not have a personal auto insurance policy.
• Personal Effects
  As you may have guessed, this type of policy will cover your stuff if it is stolen from your rental car. You may already be covered for this type of insurance if you have a renter’s insurance or homeowner’s insurance policy (check with your insurance agent).
• Personal Injury Accidents
  This type of protection (Part II of your Massachusetts policy) will cover both you and your passengers in the event that someone needs medical attention or ambulance service. Most health insurance programs will cover any medical bills that arise from an accident or other incident.  However, your Massachusetts car insurance policy may also cover medical bills up to a specified limit, depending upon the deductible you may have chosen for it.

Are You Covered?

In the end, the best way to determine if you are covered for car rentals under your current policy and to know what type of coverage you have is to contact your New Bedford insurance agent. as mentioned, some credit card companies will also extend insurance for rental cars, so it pays to contact a representative at the credit card company to find out if this is offered through your plan.

While it is important to make sure you are properly and adequately insured, you also don’t want to be spending money on extra insurance through the rental company that you don’t really need. A lot of rental companies get pushy about selling extra insurance policies, making you feel irresponsible if you don’t pony up the extra cash. The important goal here is to make sure you aren’t paying for extra coverage.

While we are at it… why rent a car? 

 There are generally two reasons why people rent a car. Either you have had an accident and your car is out for repairs, or you are away on a vacation or business. When you are on vacation, you must pay for the cost of the daily rental car yourself.  As reviewed above, you may or may not decided to purchase the extra insurance offered at the rental company. If you are on vacation, seriously consider buying the extra loss damage insurance or waiver as it is called. It can potentially salvage your vacation and not tie you up with issues of repairing a rental vehicle.  

When you need to rent a car because of an car accident and your car is out for repairs,  you may need to rent a substitute car.  You can buy Substitute Transportation – or rental coverage on your auto insurance policy and choose a daily rental limit. Call your agent for a quote on the annual cost for adding rental insurance to your policy. There are a number of daily limits available such as $15 per day, $30 per day and up.  Rental coverage can be very important if you need your car to get to work each day.