Every time you rent a car, the rental car company will offer you rental car insurance. Even the most seasoned travelers can’t help but wonder:
- Do I need rental car insurance?
- What does rental car insurance cover?
- Does my personal insurance or credit card rental insurance cover me in a rental car accident?
- What happens if I am not at fault for the rental car accident?
In this article, we’ll answer your questions about rental car insurance and offer tips on what to do after a rental car accident.
Six Steps to Take After a Rental Car Accident
If you’re in an accident in a rental car, you should take the same steps you would take after an accident in your own car and contact your rental car company.
1. Check for injuries. Get help if you or anyone involved in the accident is injured.
2. Call the police. If you’ve called 911, a police officer is likely on the way. If not, you should probably call the police department's non-emergency number to report the accident if it caused property damage. An officer will prepare a police report that might help you if you file an insurance claim or personal injury lawsuit over the accident.
3. Exchange insurance and contact information. Figure out who was involved in the accident and give them your insurance and contact information. Get their information too, along with the names and phone numbers of witnesses.
4. Gather evidence. Take pictures of the vehicles involved in the accident, skid marks, and traffic signs and signals. Document your injuries. Write down everything you remember about the accident.
5. Contact your rental car company. As soon as you can, call the rental car company and let them know about the accident. You can typically find an emergency number on your car rental agreement or in the glove box. The company will probably have you fill out an incident report.
6. Contact your own insurance or credit card company. If you declined rental insurance and you’re relying on your personal insurance or credit card for coverage, contact your insurance or credit card company and tell them about the accident.
Learn more about what to do after a car accident.
Rental Car Insurance Basics
When you rent a car, you agree to return the car to the rental company in the same condition it was in when you drove it off the lot. If you get in an accident or damage the car during the rental period, you’ll want insurance coverage to help cover the costs.
Rental car companies typically offer four types of insurance coverage, including:
Collision damage waiver. This coverage, sometimes called a “loss damage waiver,” pays for vehicle repair or replacement costs if your rental car is damaged or stolen.
Liability insurance. This coverage pays for property damage and medical expenses you cause when you are at fault for a rental car accident.
Personal accident insurance. Similar to personal injury protection, this coverage pays for accident-related medical costs of the rental car driver and passengers.
Personal effects coverage. This coverage pays for lost or damaged personal property that was kept in the rental car.
Do You Need Rental Car Insurance?
Purchasing rental car insurance isn’t cheap. Costs vary based on vehicle and location, but it can easily double your rental costs if you purchase full coverage. So, it's fair to ask, do you really need rental car insurance?
If you already have insurance, you probably don’t. You might already be covered by your current insurance or your credit card. But insurance policies vary. It’s important for you to verify that you are covered before you decline rental car insurance.
If you’re traveling for business, ask your company about insurance coverage. Your personal insurance will most likely not cover your rental car if you're using the rental car for commercial or business purposes.
Does My Personal Insurance Cover a Rental Car Accident?
Many personal insurance policies provide coverage that overlaps with rental car insurance. Here is how your own insurance might cover rental car-related losses:
Liability Insurance
Nearly all states require drivers and car owners to have a minimum amount of liability insurance coverage to pay for accident-related damage they cause. If you have auto liability coverage, your own policy will typically provide this coverage when you are driving a rental car. Check your policy limits before you travel. You can purchase supplemental liability coverage from the rental car company if necessary.
Collision and Comprehensive Coverage
If you have comprehensive and collision insurance, you might not have to purchase a collision damage waiver (CDW). Your own coverage will probably pay for any damage or loss to your rental car, but you’ll have to pay a deductible. If you purchase a CDW waiver you typically won’t have to pay a deductible.
If you cause damage to your rental car, you might have to pay the rental car company a “loss of use” fee for each day it's out of commission. A CDW will likely cover this fee. Some collision and comprehensive policies cover loss of use fees too, while others don’t. Check your policy before you decline a CDW.
Health Insurance
You probably don’t need to buy personal accident insurance from the rental car company if you have personal injury protection or medical payments coverage (MedPay). Even your own health insurance might be enough to pay for your medical costs after an accident. You’ll have to confirm your coverage and weigh the costs of copays and deductibles against the cost of the rental car company’s personal accident insurance.
Homeowners or Renters Insurance
If you have homeowners or renters insurance, you probably don’t need to buy personal effects coverage from the rental car company. Your policy will likely cover personal items damaged or stolen from a rental car. As always, check with your insurance company and know your policy limits.
Credit Card Rental Insurance: What Is It and What Does It Cover?
Many credit cards offer some insurance coverage for rental cars. You have to book the rental with the credit card to qualify for coverage.
Some cards offer high coverage limits and cover an entire claim, meaning you can bypass your own car insurance and avoid deductibles and potentially higher premiums. Other cards offer lower coverage limits and require you to file a claim with your own insurance company first.
Before you rent a car, call your credit card company to find out exactly what’s covered. Many cards don’t provide liability coverage, which is often the most important type of coverage. Call each time you rent a car because credit card rental insurance policies change frequently. Verify that the coverage limit is high enough to protect you.
Questions you might want to ask your credit card company include:
- What coverage is included—liability, collision, theft, loss of use, towing expenses?
- What isn't covered?
- Are any rental vehicles—like luxury cars, motorcycles, or large vans—excluded from coverage?
- Do I have to file a claim with my own insurance company first?
- What if I don't have personal car insurance?
- Does coverage vary for international rentals?
- How do I file a claim?
What To Do After a Rental Car Accident That Is Not Your Fault
After any car accident, including rental car accidents, one of the most important questions is: Who was at fault? Fault matters because the person who is at fault for an accident typically pays for losses (“damages”) like car repairs, medical bills, lost income, and pain and suffering.
If you’re at fault for a rental car accident, it is important that you’re properly covered by your own insurance, rental car insurance, or credit card rental insurance.
If you aren’t at fault for a rental car accident, you should let the car rental company know about the accident. You or the company can file a claim with the at-fault driver’s car insurance company to cover damage to the rental car and pay for your accident-related losses. This type of claim is called a “third-party claim.”
If a rental car company charges you fees or tries to make you pay for vehicle damage after an accident that wasn't your fault, talk to a lawyer.
Do I Need a Lawyer After a Rental Car Accident?
A rental car accident is more complicated than an accident in your own car. At a minimum, you’ll have to deal with an added layer of paperwork and bureaucracy. A car accident lawyer can help.
A lawyer can answer your questions about liability and insurance coverage. A lawyer can also negotiate and advocate for you with the car rental company and any insurance or credit card companies that might be involved in your claim.
Learn more about how a car accident lawyer can help you. You can also connect with a lawyer directly from this page for free.