DO YOU NEED TO BUY CAR RENTAL INSURANCE?

March 28, 2019 | By TERRI DICKERSON CDA Press Consumer Gal

Anytime you rent a car you can bet the agent will ask if you’d like to purchase Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) coverage. These add-ons can cost between $10 and $30 per day, so for a several-day car rental these fees can really add up. When you consider that the agent gets compensated on the value of what they can up-sell you, it’s no wonder they get downright pushy about selling this coverage.

So do you really need to purchase the car rental company’s insurance? It might surprise you to know that you could be covered through either your personal car insurance or credit card benefits. In many cases, the coverage you have on your own car extends to a rental car. Either read the fine print in your policy or call your agent to find out what coverage you have.

Furthermore, if you’re traveling abroad or don’t have insurance coverage, check the benefits your credit card offers. Many cards offer some rental car protection but the coverage is secondary to your personal car insurance in the U.S. However, it is primary internationally, except in countries excluded from coverage.

Some credit cards offer rental insurance as primary coverage, even if you have your own car insurance. This could be a good perk because if you’re in an accident, you won’t have to file a claim with your auto insurer.

Many consumers aren’t sure which credit cards offer the best protection. Not knowing could be costing you hundreds of dollars. I checked my credit cards and found one is superior in terms of coverage, so next time I rent a car I’ll be sure to use that card.

And make sure if you’re counting on the coverage that you follow the rules specifically when renting the car. For example, you must decline the rental car insurance and in many instances the entire rental bill must be charged on the credit card, not just part of the bill. Also, check the rules if you use points to “pay” for the rental.

One area of coverage worth exploring in detail is loss of use coverage. This is the amount a car rental company can recover from you in the event you’re in an accident and the car is taken out of service to be fixed. Policies I reviewed had varying coverages.

Suffice it to say that it isn’t possible to detail the different car insurance coverages and credit card company benefits in this column, so the next time you need to rent a car, it would be worth checking out your own benefits before you pay for something you don’t need.