If you rely solely on your credit card or personal auto insurance for rental car insurance coverage, there may be limitations.
Sean Beasley, who spends a lot of time on the road, pays extra for his insurance policy, and rental car insurance is included.
“I would say I rent a car about 20 times a year,” Beasley told CTV News Toronto.
“I don’t buy insurance because my car insurer automatically offers us rental car insurance. Both car insurance and credit cards can have significant restrictions on rental cars, including the types of vehicles covered, duration and countries.”
Since rental car insurance can be expensive (sometimes it costs an additional $50 per day), the question arises as to when it makes sense to purchase it when renting.
According to Consumer Reports, you may need separate rental insurance depending on the coverage you have for your own vehicle.
“If you only have liability insurance for your own car, you will need to take out a separate policy for the rental car in case it is damaged in an accident,” explains Lisa Gill of Consumer Reports.
Below are some guidelines to help you decide if additional insurance coverage is right for you.
Some rental car insurance policies and personal auto insurance policies from credit cards do not cover certain types or classes of vehicles, such as luxury vehicles or large SUVs.
When you rent a car abroad, many companies offer that their insurance coverage applies only to rental cars in Canada and the United States. The same goes for the rental car insurance offered by most credit card companies.
Motorhomes, vans and moving trucks are typically not covered by standard auto or credit card insurance policies.
If you decide to purchase additional insurance, you should consider up to three types: comprehensive insurance, which covers damage to the car in the event of an accident; collision damage waiver, which protects you against theft and damage to the vehicle; and third-party liability insurance, which covers you if you are held liable for property damage or injury to a person while driving the rental car.
Terms may vary slightly between car rental companies, so read policies carefully to ensure the vehicle has the necessary insurance coverage.
Last year, Thomas Coish told CTV News Toronto he refused to purchase rental car insurance to rent a pickup truck. He thought he was covered by his own policy, but found out he wasn’t. Unfortunately, the pickup truck was stolen and he had to pay $50,000 to cover the loss of the pickup truck.
