Most people think rental car insurance is just a scam or a waste of money. But making smart decisions about insurance may end up saving you a significant amount in the long term.
1. Loss Of Use
Most auto insurances will cover your rental car and are within the limits of your comprehensive coverage. However, personal insurance does not include hidden costs of damage to a rental car. Payments made to the rental car company for the loss of income termed as ‘loss of use’ while the vehicle is being repaired will be borne directly by you.
2. International Travel Exclusion
Limitations to personal auto insurance could also be geographical. Insurance companies sometimes do not cover car rentals outside the United States. Often certain countries are also excluded from rental insurance benefits.
3. Protection From Personal Insurance Rate Hikes.
While claiming your auto insurance, you can be assured that your premium will rise afterward. In most cases, claims arising from additional rental car insurance purchased during the rental won’t affect your personal auto insurance premiums.There is also the option of supplemental liability insurance that is provided by car rental companies that cover damages that your primary auto insurance will not cover.
4. A Credit Card Included Insurance May Not Be Comprehensive
Credit cards often come with auto insurance included. These have quite specific limitations and don’t necessarily provide complete cover. Most of these cards stipulate that the particular card has to be used to rent the car in your name.Many cards do not cover the administrative fees and hidden charges that may arise from a claim against a rental car. Reading all the fine print and conditions of use could spare you significant expenses in case of an accident claim.
5. Personal Deductible Is Expensive.
Rental car insurance may work out cheaper than using your insurance because of your deductible. If you have set a high deductible, you may end up paying a significant amount in case a claim arises. Most often, the daily premium for rental insurance is far cheaper than the alternative.
6. Personal Auto Insurance May Not Cover Business Travel
Some firms cover the guarantee of a car used during business travel. There is a downside if the journey is extended to include travel for pleasure too. Your auto insurance will not cover the pleasure part of the trip to lessen the hassle of re-renting and paperwork. It’s easier to opt for rental car insurance in that case.
Err On The Side Of Caution
It is human to gamble on the fact that nothing untoward will happen and you could save some money by not opting for rental car insurance. It is likely that you will not require to claim it. But if there is an accident or problem with a rental car, having this insurance would help keep your peace of mind and keep you safe from any additional financial burdens.