When you’re at that car rental counter and you’re asked whether you’d like to purchase car rental insurance, what do you say?.
Do you purchase it or not? Is it something you need for your rental? Apart from the cost of the rental itself, the car insurance from the rental company amounts to almost the same amount.
Car rental companies make most of their money from the sale of car insurance for their rentals. If you think about it; if one car is rented out for an entire year (let’s assume it’s a busy agency), car rental insurance would amount to an average of ten thousand dollars. This would practically pay off nearly half the cost of the vehicle in question. Now, as a renter, do you need to purchase car rental insurance?.
The truth is that you need to have your rented car insured before you can drive it. If you don’t have a valid car insurance plan on the vehicle, you could get pulled over by the police and could have your car impounded. This would essentially leave you paying so much more for things such as impounding and repossession of the vehicle.
To avoid such costs, it is important that you have an insurance policy on the vehicle you are renting. You will always have to purchase car rental insurance or you may not need to. We will be looking at both cases in extra detail below. There are various types of car rental insurance plans offered by companies, as some offer a no deductible while some come with a $500 deductible.
No-Need to Purchase Car Rental Insurance: You would have the option to not purchase insurance from the car rental company if you already have some sort of coverage as part of your existing insurance policy. For those who have an auto insurance policy of their own, it may even include an option for extending coverage to vehicles not owned by you.
This would essentially cover your car rental and would not require you to purchase from the rental agency. Tons of people do not know this and end up paying for the auto insurance from the car rental company. Alternatively, there are a number of credit cards that offer full coverage for car rented using that credit card. So, if you put the full purchase of your car rental on the credit card, you will be covered by the insurance portion of the card.
Mandatory to Purchase Car Rental Insurance: It would be mandatory to purchase auto insurance from the car rental company if you do not have a special coverage on your credit card or if you don’t have a policy of your own. For those who already have auto insurance with a company, you need to find out whether you are covered for cars that you do not own.
If you aren’t covered, you could definitely get that option added onto your policy. Your premium would only increase by a small percentage and it would allow you to benefit from cheaper car rentals. Before you finalize anything with a car rental representative, make sure to go through the terms of the policy.
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