Over Christmas vacation, my husband and I packed up our boys and all our Christmas gifts to travel halfway across the country from Texas to North Carolina to visit family for Christmas. Because we didn't want to put 3,000 miles on our car, we rented a car for the little over a week that we were going to be gone.
I knew that when it came time to sign the paperwork when I picked up the rental car that they were going to ask me if I wanted to pay extra for their rental insurance (which can be pretty hefty), so I decided to research what our options were before we picked up the car. This is what I found out:
Check with your Auto Insurance Company
I called our auto insurance company, and they would cover us in the rental car with our existing policy as long as each driver was listed on the policy. However, all of our normal deductibles (like the $500 collision deductible) would apply. Also, in case of an accident, the rental car company would also charge an administrative fee, loss of use, and possibly loss of value (depending on the severity of the accident) that we would be on the hook for.
Check with your own insurance company before you rent to see what they would cover for you in case of an accident (like collision, liability, etc).
Check with your Credit Card Company
If you plan on paying for the rental using a credit card, be sure to check and see if your credit card has any car rental coverage when you use that card. We planned to use our American Express card, and when I called them they sent me a document showing me that they would act as a supplementary insurance above and beyond my auto insurance company.
However, when I was checking with American Express, I stumbled upon a premium rental insurance where you can sign up for $24.95 for each rental (or less depending on the state) and they will cover the rental car up to 30 days up to a certain amount (in our case it was $19.95 for up to $50,000 worth of coverage).
With this coverage, you are only responsible for liability insurance (in our case covered by auto insurance), and there is no deductible for any damage. You don't have to coordinate with your insurance company for a claim also, so you don't have to worry about your rates going up (unless you were to get points from a ticket).
How it Worked for Us
It's great to find out how it's going to work in theory, but we actually had a chance to test it out on our trip to North Carolina. In Atlanta, we swerved to avoid what looked like a small, square board on the highway and thought we had missed it until we heard a thump. At the next exit, we noticed a nice scrape in the body that we knew we were going to be responsible for.
I'm so thankful that I signed up for the premium rental insurance with American Express before our rental, because the claim went smoothly for us. I stressed out a little bit about it, but shouldn't have bothered because American Express paid the entire claim for us (with our part being the $19.95 fee we pay every time we rent a car). It wasn't a huge amount (about $350), but we would have had to pay it entirely out of pocket if we had just used our auto insurance.
How about you? Do you pay extra for rental insurance or do you do your research before you go?
Disclosure: This article is an example of what works for us and may not work for your own situation. As with all things, please use your own best judgment when deciding whether to add extra rental insurance or not.
If your vehicle is damaged and there is no liablity and you purchased extra insurance then you won't have to worry about your auto insurance increasing but if there is another car involved then most likely your auto insurance company will increase your rates.
It may carry by state but I've been a licensed insurance agent for almost 10 years.