Do I Need Auto Insurance for My Rental Car?
Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
If you’ve ever rented a car, you’ve likely been sold the auto insurance that the rental company offers. But if you already have insurance for your regular car, do you need to purchase an insurance policy for your rental car as well?
“The short answer is probably not,” says Michael Barry, vice president of media relations for the Insurance Information Institute. “If you’ve already found out how much coverage you have on your car, whatever coverage and deductibles you already have on your own car [are] probably covered.”
Don’t over insure yourself
You don’t want to spend money where you don’t have to. If your own insurance will cover your rental car, it may not be necessary to purchase additional insurance. To find out if you’re already covered, do the following:
Talk with your insurance company. Find out exactly how much coverage you have, Barry suggests. “If you have auto insurance, you are in all likelihood covered from many of the things that could potentially happen when you rent a car.”
That includes any damage to the vehicle that occurs while you’re driving, damage that you cause to other vehicles, and bodily injury.
Talk with your credit card company. If they cover anything, credit card companies usually cover only damage to or loss of your vehicle, not issues with other cars or costs related to injuries, Barry says.
Still, it’s worth checking with your credit card company to see if it can save you money by covering at least part of the insurance you are considering for the rental car.
Find out if an umbrella policy covers you. If you own significant assets, you may have an umbrella liability plan that kicks in when all other insurance plans don’t. According to Barry, this umbrella policy may negate the need for rental car insurance because it provides you with protection above and beyond your regular policy.
Don’t underinsure yourself
The National Association of Insurance Commissioners warns that while purchasing unnecessary insurance is a waste of money, not purchasing enough can be costly as well
The provided amount of liability insurance likely won’t cover you. Rental companies must provide the state-mandated minimum amount of liability coverage when you rent a car, Barry says. But that amount likely won’t cover you completely in case of an accident.
“The problem with [state minimum coverage] is that most people driving around carry much more than the mandatory minimums. If you’re in an accident and medical bills start coming in, then $25,00 or $50,000 doesn’t look like much coverage,” he explains.
If the rental car is being used for business, you may need coverage. In general, your car insurance will only cover rental cars being used for leisure. Again, Barry suggests you consult with your insurer if you don’t know what your policy covers.
Educate yourself before arriving at the rental counter. According to information from Ned Maniscalco, a spokesman for Enterprise Holdings, which owns the Enterprise, National, and Alamo car rental companies, an educated consumer is the best consumer.
“It is always helpful when a consumer knows before renting a car what his or her credit cards or auto insurance policy might cover, and if it transfers to the rental vehicle,” Maniscalco says. By being proactive and contacting your insurance provider ahead of time, you can save money while also making sure you have the right coverage for your situation.
Ilyce Glink is the author of ten books, including the bestselling 100 Questions Every First-Time Home Buyer Should Ask. Her nationally syndicated column, “Real Estate Matters,” appears in more than 125 newspapers and Websites, and her online “Ask Ilyce” columns are read by hundreds of thousands of people every month. She is a top-rated radio host on WSB Radio in Atlanta, the Home Equity blogger at CBS MoneyWatch.com, host of the Internet program “Expert Real Estate Tips,” managing editor of the Equifax Personal Finance Blog, and publisher of ThinkGlink.com.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.