Rental insurance companies overcharge for their insurance options, plus, your personal coverage likely already gives you the benefits you need. If not, your credit card might, too.

When you’re at the counter of a rental car company, you’ll likely be hit with a sales pitch to tack on rental car insurance.

The pitch will seem more like a list of what could go wrong if you don’t fork over the extra cash for their insurance. At the moment, it can feel like you don’t have a choice.

Luckily, many personal auto insurance policies will cover you in a rental car, so there’s really no need to be afraid of the intense sales pitch.

Chances are you don’t need their rental insurance at all.  

Does your auto insurance cover rental cars?

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It’s highly possible, even likely, that your personal car insurance will cover you in your rental vehicle.

Let’s take a close look at the types of insurance coverage offered at rental counters — and how to determine if they’re already included in your existing auto policy.

Read more: Car insurance definitions: what every driver needs to know

If you have liability insurance, you may want to buy some additional rental coverage

A supplemental liability insurance policy will cover damages done to other vehicles or property.

If you don’t have any liability coverage at all, then you should consider buying this from the rental company.

Even if you have your own minimal liability policy, you still might want to add this coverage at the rental counter for additional protection. The coverage limit will depend on your rental car company, but $1 million is the standard limit.

Read more: Auto insurance liability limits: how much do you need?

If you have personal accident coverage, you don’t need any additional rental coverage

If you or your passengers are injured, personal accident coverage will kick in and can cover costs such as medical care and ambulance rides. 

Already have a personal injury protection policy? If so, personal accident coverage through your rental agency will likely be redundant.

Personal accident coverage can also provide death benefits in the worst-case scenario. But if you already have life insurance, this is an easy thing to pass up. 

If your auto insurance includes personal effects coverage, you don’t need extra coverage

You can buy personal effects coverage to protect the value of the items in your rental car. The dollar amount will depend on the unique policy option.

Do you have homeowners or renters insurance? If so, those policies should cover your possessions, even if they’re stolen away from home.

You’ll have to file a police report to make a claim for stolen items through this policy. And don’t forget that you’ll have to pay the deductible on the claim.

If you don’t have homeowners or renters insurance, then consider the value of the items you have in your vehicle. Are you carrying anything that you couldn’t easily replace?

For example, it might not be worth taking out this policy through your rental company if you’re only toting around a second set of clothes and a toothbrush. But if you have your laptop and camera in tow, then the personal effects coverage might be more important.

Weigh the value of the items against the cost of the policy before you decide.

Your credit card is your next best option for rental car coverage

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If you use your credit card to pay for the rental car, you may find your card offers protection. 

The details of your credit card-covered rental car insurance policy will vary. If you plan to use this option, take some time to find out the answers to the following questions before reserving your next rental vehicle:

  • What’s covered? Your credit card may only cover one type of rental car insurance.
  • How can you use the coverage? Make sure there are no special requirements that you have to complete to use this coverage. Call up your card company to verify.
  • Are there any exclusions? Ensure the coverage is available for the location you’re planning to go to.
  • Is the insurance offered primary or secondary coverage? Secondary coverage means that it would kick in after your personal auto insurance policy is in effect. Primary coverage means that any claims would come through this policy first.

Read more: Is it worth it to get a credit card just for the insurance benefits?

If all else fails, you can also buy your own private rental car insurance

I can’t stress this enough: you don’t have to go with the (often overpriced) rental car insurance policies offered at the counter.

Here are some of the top providers:

  • Insure My Rental Car – You can get up to $100,000 of damage coverage for your rental vehicle for as little as $6.
  • Rental Cover –  You can get a no-deductible policy as primary coverage.

You can buy these policies ahead of time for your rental car insurance. That way, you can confidently say, “No, thank you” at the desk — and save big.

Still need rental car insurance? Here’s how much it’ll cost you

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You can expect to pay $10 to $30 per day on your coverage. If you’re renting a car for any length of time, this will take a big bite out of your budget.

For example, let’s say you’re enjoying a week-long vacation in Florida. The rental car company wants you to pay $25 per day in insurance premiums for a whole week. That might seem reasonable at first, but it’ll lead to a $175 bill for insurance that may already be covered by your auto insurer.

When is rental car insurance a smart move?

If you don’t have car insurance of any kind or don’t own a car, then rental car insurance is a good idea. You don’t want to run into any issues, and unfortunately, accidents do happen. As the old saying goes, better safe than sorry.

Beyond that, it is illegal not to have car insurance of any kind in most states. Make sure that you are meeting the minimum insurance requirements of the state before starting up your engine. 

Read more: These states don’t require car insurance

Summary

Renting a car can be convenient. Paying for extra rental car insurance? Not so much.

Luckily, there are many options to avoid paying for a pricy rental policy — including the insurance you already have.

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About the author

Total Articles: 60
Sarah Sharkey is a personal finance writer covering retirement, investing, debt, savings, credit cards, mortgages, and student loans. Additionally, she is the founder of Adventurous Adulting, a personal finance blog dedicated to helping readers tackle their money and take control of the adventure of life. You can connect with her on LinkedIn or Twitter.