Is Rental Car Insurance Worth It?

Whether you’re heading home for the holidays or embarking on a cross-country adventure , if renting a car is part of your plan, you’ll want to be prepared for all eventualities. That includes understanding whether you need rental car insurance, and if so, how much.

Insurance in general usually isn’t fun to think about, and rental car insurance is no exception. Who wants to plan for the worst on their vacation? And what are the chances of getting into an accident  during the short time you’re driving a rental anyway? The reality, however, is that understanding your insurance options provides you with essential peace of mind, allowing you to relax and focus on the present, rather than worrying about the future. Here’s what to consider when deciding whether to get rental car insurance.

How much coverage do you already have?

You might already be covered in the case of damage to or issues with your rental car, and not even know it. Some credit cards offer rental car insurance as part of a package if you use their card when renting. If you carry standard car insurance for the vehicle you regularly drive, your rental is likely to be covered under this policy, as well, in most states, although there may be gaps in the coverage. (The policies likely don’t extend to business travel, for example.) In many states, a rental car company is required to provide a bare minimum level of coverage as well. Additionally, if you face issues as a AAA member, you can also call AAA roadside assistance.

Before you even begin looking into any rental car insurance options being offered to you by the rental company, or any you might have turned up through research, avoid doubling up on insurance by looking into any coverage you might already have.

What type of additional coverage do you need?

If you find that you don’t have any pre-existing coverage, or that your pre-existing coverage leaves something to be desired, you’ll want to take into account the different options that you’re presented with, and how much the rental company expects you to pay for them. The main rental car insurance types are:

Rental car liability insurance

This insurance covers damage to other drivers’ vehicles, as well as their medical coverage, in the event that you cause an accident. This kind of plan is especially key if you’re traveling to an area where a potential accident would be likely to incur especially expensive damages—for example, if you’ll be driving alongside the entrants in a custom hot rod competition.

Rental car loss-damage waiver insurance

By purchasing loss-damage waiver insurance, you excuse yourself from being held liable for covering the cost of a total loss, damage from an accident, environmental damage, or theft and vandalism if your rental. This may be especially important if you’re heading to an area prone to severe weather or particularly populated with vehicle vandals and thieves.

Personal accident car rental insurance

This insurance can help address some of the scariest possibilities related to an accident in a rental car: the medical bills incurred by yourself and your passengers if you’re injured. Importantly, this policy will cover you regardless of who is at fault.

Rental car personal effects coverage

Personal effects coverage covers the items that you have in your car. This kind of coverage is especially important if you’re going to be parking your car on the street or in a public garage where it’s more easily accessible to potential thieves. It’s also key if you keep electronics or other expensive personal effects in your car, and want to be sure that you’ll be able to recoup your losses should the worst happen.

As complex and confusing as insurance may seem, it’s important to make informed choices when renting a car. It’s the right move for both your peace of mind and your wallet.