When you rent a car, you’ll be asked at checkout if you’d like to add insurance. Cue a few moments of slight panic — does my car insurance cover rental cars? Would it be enough if something happened while you were driving the rental car? Will you be driving without legally required insurance coverage?

Here’s what you need to know to decide if it’s necessary to buy rental car insurance.

You May Be Somewhat Covered

The long story short is that each insurance policy is different and you should always check with your provider prior to renting an car. However, in general, the insurance options offered by a rental company often overlap with insurance policies you already have.

Liability Insurance

States require all drivers to have automobile liability insurance to cover injuries to another driver and damage to others’ property if you’re involved in an at-fault accident. However, if you only have the minimum legally required liability limits, you may want to increase your coverage while renting to ensure you are properly protecting yourself.

Comprehensive and Collision Coverage

If you have full coverage, that means you have comprehensive and collision insurance that provides coverage to your automobile for incidents while you’re driving (such as hitting a pole) or when you’re not driving (like storm damage or theft). You should check with your auto insurance company to ensure that this extends to rental cars. In the event of an accident involving a rental car, you would most likely still be required to pay your insurance deductible.

Beware — even if the damage to a rental car is covered by your insurance, turning down rental protection offered through the rental agency may make you liable for lost income to the rental company if a car you’re driving has to be taken out of commission for repairs.

Injury Protection

If you have health insurance, any kind of PIP (personal injury protection) or MedPay, the injury protection offered through the rental company could be redundant.

Homeowners or Renters Insurance

What if your possessions are stolen from a rental car? If you have homeowners or renters insurance, coverage would likely extend to any personal items that are stolen from a rental car (but be sure to file a police report).

Credit Card or Travel Insurance

You may have rental car insurance through your credit card company if you use the card to pay for the rental. Call the 1-800 number on the back of your credit card to determine if this is a service they provide.

If you have purchased travel insurance, car rental collision coverage may be included.

Be sure to ask what is covered — you never want to assume a higher level of protection than what actually exists. This type of coverage is typically secondary insurance, meaning it would pay out only after your primary auto insurance.  Therefore, you may not want to forego this additional coverage if this is the only other form of insurance you have.  

Sometimes It’s Worth It

If you don’t have coverage, such as if you don’t own a vehicle or have protection through a credit card, you should purchase insurance either through the rental agency at the counter or a third-party provider before you pick up the car.

If you have a high deductible plan, you may want to explore the insurance options at the rental agency, as you may be able to secure a lower (or no) deductible.

If you have minimal coverage or are renting a car worth significantly more than your personal car, you should consider purchasing additional coverage through the rental agency.

Any claim made against your personal auto insurance may impact your premium; if that’s a concern, consider purchasing additional coverage.

If you are traveling for a significant length of time, you should confirm with your insurance provider that there are no time limits on rental coverage. 

Additionally, if you are traveling for business you should confirm that your personal insurance will extend to the business rental.

Your policy may not extend to overseas rentals, and some local laws may prevent you from leaving until you’ve paid for any damages. Make sure that any travel abroad is covered by contacting your insurance company directly.

If you are concerned about your coverage, the roughly $30 per day you pay to be covered through the rental agency may be worth it for your peace of mind.

 

The best thing you can do is to be informed about what your policies cover before you step up to the counter. If you already work with a Farm Bureau agent, contact them directly to discuss your policy. If you work with another company and are unhappy with your coverage, talk with your local Farm Bureau agent.