An Independent Insurance Agents and Brokers of America survey found that nearly one third of consumers do not thing or do not know if their current policies cover them in a rental vehicle. Actually, most personal auto insurance policies provide protection for any liability you incur for injuries or property damage you cause to others within the U.S. Driving a rental car is considered to be the same as driving your own vehicle for liability purposes.
Liability Damage Waiver
It's not usually necessary to purchase a Liability Damage Waiver from the rental car agency since you usually already have coverage under your own insurance. Always request a copy of the rental agreement to review ahead of time with your independent insurance agent.
Collision Damage Waiver
Rental car agencies typically try to sell "Collision Damage Waivers" (CDW) for about $8 - $15 per day. These waivers are not insurance. In effect, CDW is simply a promise made to the rental car agency taht they won't make you repair or replace a damaged or stolen vehicle. If you already carry collision and comprehensive coverage under your own personal auto policy, your insurance will extend to the rental car. Consumers need to carefully evaluate their existing coverage and discuss whether or not purchasing a CDW is appropriate for them.
When CDWs May Be Appropriate
There may be gaps in the coverage your insurance policy provides for rental cars. For example, many car rental companies may hold you responsible for the loss of use of a damaged rental car. Rental car companies may charge you the daily rental rate for every day the car is undergoing repairs. While many auto insurance policies will pay "loss of use" charges, those that do set limits. There are other expenses that most auto policies do not cover. One example is diminished value which can amount to several thousand dollars. Consult your independent insurance agent to find out what's best for your needs.
Check The Vehicle
An important way to protect yourself when renting a vehicle is to check over the car carefully for damage in the presence of a representative of the rental car company, beore you leave the lot and when you return it. Request all prior damages be noted in writing. Car renters have been known to receive damage claims from rental car companies weeks after turning in vehicles. There is no way to prove your innocence at that point.
