Do You Need Auto Rental Insurance? Get the 411

Renting a vehicle is a convenient way to get around when your own vehicle is not available. Renters, however, sometimes overlook the insurance aspects of auto rentals. What type of insurance do you need, if any? This article examines some of the key issues involved in deciding whether to purchase insurance coverage from an auto rental company.


In most cases, you will not be responsible for any damages due to a collision because your personal auto policy will cover you when you operate a rental car. Some vehicle owners, however, particularly those with older cars, may have waived collision coverage in their personal policies to save money. If you have collision coverage, contact your insurer to make certain that the policy covers rental cars. If your insurer does not cover rentals for some reason, or if you do not have collision coverage, then consider purchasing this coverage from the rental company.

Credit Cards

Many credit card issuers provide some coverage for individuals who pay for auto rental with a credit card. The credit cards typically do not cover liability or personal injury, but often cover collision damages and protect you against theft. Coverage from a credit card company usually comes with various restrictions, however. For example, the coverage that comes with a credit card will be secondary to your primary insurance, and many credit card issuers will not cover a vehicle valued at more than $50,000. Also, some issuers do not cover vehicles that are rented for more than 31 days. Credit card providers may restrict coverage to cars rented in certain foreign countries, as well.


Do you plan to put any valuable belongings in your rented vehicle? If so, then check your homeowners insurance policy, or renters insurance policy if you rent your home, before paying for the car. Most of these policies typically include an off-premises coverage. This type of provision protects your belongings against being lost or stolen. Insurers generally have monetary limits on off-premises coverage, so make certain that you know whether a particularly valuable possession will be fully covered if it's lost or stolen from a rental car. Check the deductible on your coverage as well.

Whether or not you need to purchase auto insurance at the rental counter depends on a variety of factors, such as what your personal policy covers, what type of credit card you have, and whether you plan to place any valuables in the car. Use the above information to make the best decision for your specific circumstances.