The Insurance Information Institute has some great tips on making that decision in their article Rental Car Insurance. Some of their ideas are included below.
If you own a car, find out how much coverage you already have. In most cases, whatever insurance and deductibles provided by your auto policy would apply to a rental car, providing you are using the car for recreation, not business. However, if you have dropped either comprehensive or collision on your own car as a way to reduce costs, you will not be covered if your rental car is stolen or damaged in an accident.
Ask if your insurance company pays for administrative fees, loss of use or towing charges. An insurance rider may be available to cover some of these costs, which would make it less expensive than purchasing coverage through the rental car company.
Most credit card companies provide some level of insurance for rental cars. Call the toll-free number on the back of the card you plan to use to rent the car. Ask them to send you the rental car coverage information in writing. Usually the credit car benefits are secondary to either your personal auto insurance policy or the coverage offered by the rental car company.
Insurance benefits differ widely by both the credit card company and/or the bank that issues the card, as well as by the level of credit card used. Credit cards generally do not provide personal liability coverage. Some credit card companies may provide coverage for towing, but may not provide for diminished value or administrative fees.
The Internet has made other alternatives to brick and mortar car rental companies easy to find. Like Peer-to-Peer car services which enable consumers to rent personally owned cars from others and car sharing programs allowing consumers to pick up cars in a wide range of locations for short or long periods of time and usually require a monthly or annual fee.
The insurance offered by these companies is not standardized. It is therefore important to go to the company’s website to read the insurance coverage information carefully. If you have any questions, call the customer service number listed on the website. And contact your auto insurer if you feel you need more information to make an educated insurance coverage decision.
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