Rental Car Insurance
You would usually buy car insurance for your personal car, but when it comes to rental cars your may think it is not essential and that it is an unnecessary expense. But, rental car insurance is as important as your personal car insurance.
There are certain options that are available for rental car insurance which you should consider when you renting a car. The options are as follows:
Collision Damage Waiver (CDW):
The Collision Damage Wavier, also known as loss damage wavier, is an important option to consider when renting a car. If you take this option, the renter is responsible for the first several hundred dollars if any damage occurs to the rented car. If your personal car loan has a provision for payment of damage to rental cars, you would not require CDW. Some credit card companies also offer the CDW for their cardholders. The CDW offered by credit companies would supplement your car rental insurance coverage. It means if you get into an accident, your car insurance company would pay the maximum amount for the loss and the credit card company could cover the remaining difference.
Personal Accident Insurance (PAI):
It provides coverage against accidental death and medical coverage to the renter of the car. This is an optional policy. If your personal car insurance covers car rentals, you may not require it.
Additional Liability Insurance (ALI):
This is also an optional insurance coverage that provides you coverage against injury, accidental death and other property damage caused by the rental car. If your car insurance already covers liability insurance then you don't need to buy ALI separately.
Personal Effects Coverage (PEC):
If you have personal effects coverage, it provides protection against theft or loss of personal items in the rental car. But if you have this option in your personal loan or existing insurance cover, you would not require this.
When you buy car insurance for your rental car, your insurance provider will usually ask for details in your rental car contract. The contract is a document, which contains all the clauses that should not be violated. The rental contract protects the interest of the car rental company.
All car rental agents offer the basic CDW, SLI. They also offer other options, but if you purchase you rental car insurance from your car rental agent, you usually end up paying more for each of the options you buy.
When a car is rented, irrespective of who is at fault, the renter of the car is held responsible. It is therefore essential that you have the necessary car rental insurance coverage if you decide to rent a car.