You know that if you own a car, you need car insurance to protect yourself and comply with state law. But you may not be as confident about the insurance situation if you rent a car.
The problem with that lack of confidence in the insurance situation when you rent a car is that a pushy salesperson could push you into a bad deal at the counter.
How should you make sure you have coverage when you rent a car? And which option should you turn to for insurance? That’s what a listener of the Clark Howard Podcast recently asked.
Should I Buy Insurance From a Rental Car Company?
Should I buy car insurance from the company from which I’m renting a car?
That’s what a Clark listener asked on the Dec. 12 podcast episode.
John in Georgia asked: “Do you recommend buying additional insurance from a rental car company?”
The answer from Clark is a clear no.
“The salespeople at the counter, the rental car agents? They’re under extreme pressure to get you to buy all the ancillary pseudo-insurance coverages. And that’s where all the profit is for the car rental company,” Clark says.
“Not only have I not recommended it, I’ve never done it.”
How Should You Insure Your Rental Car?
There are two ways you should cover yourself with auto insurance before you buy a policy from the rental car company.
- Your own car insurance policy
- One of your credit cards
Of course, you want insurance before you get behind the wheel of a rental car. Hopefully, you don’t have an accident. But just in case, you don’t want to be fully liable for anything that happens.
You probably have some coverage for your rental car already. If that’s the case, you’re wasting your money succumbing to the borderline fear tactics that rental car agents use.
“Check with your own automobile insurer and see if you’re covered for temporary use of a rental car. Almost always you are for a period of up to 14, 15 or 30 days,” Clark says.
We’ve also put together a list of the best credit cards for primary and secondary car rental insurance. You have to decline insurance from the car rental company for your credit card coverage to be valid.
Keep in mind that, just like your auto insurance, credit card coverage for this purpose is limited. It’s often good for up to one month of coverage with American Express and Chase cards. You’re also limited by country and type of vehicle. Negligent behavior can nullify your credit card insurance coverage as well.
“That one-two allows you to eliminate anything that you might consider buying from the car rental agency,” Clark says.
Rental Car Insurance: Make Sure You Document the Vehicle
No matter how you’re getting your coverage, it’s important to document the condition of your rental car before you drive it off the lot and after you return it.
Being covered by some type of rental car insurance is helpful. But through negligence or disorganization, it’s possible that a rental car company could pin damage to you that you didn’t cause.
“Always shoot video with your phone and take pictures of the rental car that you are renting. Any marks on it, dents, anything like that,” Clark says. “You want to document on your phone before you leave.
“When you return, you again shoot video or take pictures so that if later the car rental agency alleges that you have damaged the vehicle, you have the documentation that you did nothing at all to that vehicle. Because otherwise that could be a real hassle, if not a meaningful expense.”
Rental car insurance is a profit puppy of the giant rental car corporations. You may face some aggressive sales pressure from rental car agents at the counter to buy coverage from them.
But if you have an auto insurance policy for your own vehicle, and a credit card that offers temporary rental car insurance as a benefit, you probably don’t need to hand over extra cash to the car rental company.