You’re standing at the rental counter in a city half-way across the country. After you’ve chosen your car, the sales clerk asks, “Would you like insurance with your rental car?” They then describe various types of coverage. Do you need this insurance? Or can you save yourself the cost? As with many things in the insurance industry, the answer is this: It depends.
Research Your Rental Insurance Possibilities
Car insurance belongs to the list of things you need to look into before you travel. Your regular car insurance policy may cover you, but so might your credit card. In addition, not purchasing rental coverage when renting a vehicle could affect your personal insurance should something happen.
Your Car Insurance Policy
When you sign up for auto insurance, your policy won’t automatically cover a rental vehicle. However, you can ask for a rental vehicle insurance endorsement. This is sometimes referred to as “OPCF 27” or “Legal Liability for Damage to Non-Owned Automobiles.” It’s a form of liability coverage and covers you for damage to a vehicle you don’t own.
However, do keep in mind that this additional coverage is only valid for vehicles you don’t own in Canada and the U.S. If you’re planning a trip outside of those two countries, then your auto insurance policy won’t cover you.
Using Insurance on Your Credit Card
This is an option many people don’t think of. Your credit card may come with various types of insurance. This is one time where you’ll want to read the fine print on that credit card agreement. So long as the entire transaction for your rental car is on one credit card, you may have enough insurance coverage for your needs.
Examples of Coverage Through a Rental Company
Enterprise offers damage waiver, personal accident insurance and personal effects coverage. Damage waiver is the most expensive and costs between $13.99 and $29.99 per day. The waives or reduces your responsibility for loss of or damage to a rental vehicle.
Personal accident insurance covers the renter and their passengers for accidental death, accident medical expenses and ambulance expenses. Personal effects coverage insures the renter, other drivers of the vehicle, and the renter’s immediate family (who live in the same household) against risks of loss or damage. Enterprise offers both together for $6.99.
This is just one example of the kinds of coverage you can find. Different companies offer different types of coverage. Make sure you check with your rental company for all the details.
You Have Insurance But Buy Insurance Anyway
If you buy insurance at the counter because you don’t know if your personal policy carries coverage, what happens if you get into an accident? It depends on the province. In Ontario, for example, your personal insurance will be used before your rental car insurance. If your personal auto insurance has enough coverage, then you’re wasting your money buying insurance through the rental agency. This is why it’s important to research these options before you leave home.
Call Your Broker Before You Leave
It’s that simple. If the idea of reading and then interpreting the legalese of your insurance policy doesn’t excite you, call your broker. If you’re already covered for the insurance you need when you drive a rental vehicle, you can save yourself a few dollars and put that money toward a nice meal or some more souvenirs.