Does My Auto Insurance Cover My Rental Car?


Read this before taking the keys.  It’s a familiar question to all of us who’ve rented a vehicle, “Would you like to add the rental insurance for an additional $X today?”  For an additional (usually per day) fee, the car rental agency promises that you will not be charged or held responsible for damage done to the rental. Before you make a decision, consider a few factors:

Loss-Damage Waiver vs. Liability Insurance
The big sell for the rental company is going to be the loss damage waiver (LDW). A LDW is technically not insurance at all, but rather a waiver that protects you from being held accountable for any damage done to the vehicle while you are renting it. Liability Insurance, on the other hand will cover damage other vehicles or property.

You May Already Be Covered
Your auto insurance policy may cover you while you drive a rental car. This means the liability limits of your current policy may apply. Keep in mind, of course, claims against your insurance policy will come with a deductible that you will be responsible for paying. It’s also possible that your credit card company is automatically covering you as well. However, credit card coverage is secondary, it will only come into effect after your insurance policy has paid out.

Read The Rental Contract

It is a contract and you are signing, so read it first!  It may tell you they are going to charge your credit for the rental car damage while waiting for your insurance company to pay.  Really, read the small print.

This is an important to talk to your agent.  Call AmeriAgency at 615-209-9362.

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