Car Rental Insurance Can Cost You A Lot Of Money

You sign a contract to rent a car for $50 a day, but it costs you nearly $100 when you pick up the vehicle. What is going on here? The car rental company is charging you a lot of hidden fees. Some of the fees are taxes, and surcharges and other government fees. But a lot of the hidden fees are in the form of car rental insurance costs.

What are these insurance costs and how much do they cost?

When you rent a car you will be offered four types of car rental insurance. Some of these may be covered by your personal car insurance policy, by your home owner or renter policy, or by your health insurance. The four types of insurance coverage are: (1) Liability Insurance; (2) Comprehensive and Collision Coverage; (3) Personal Accident; (4) Personal Property.

Liability Insurance: This covers you if you injure another person or destroy property in an accident. Rental companies are required to provide the minimum level of liability insurance. This may not be enough if you are involved in a serious accident. Most personal car policies will provide this coverage, but check with your insurance agent first to confirm the amount of coverage that you have. This coverage will generally cost $10 to $15 a day.

Comprehensive and Collision Coverage: Rental car companies will hold you responsible for all damages to your rental vehicle if it is involved in an accident. Liability insurance will cover damage to someone else’s vehicle but you will need comprehensive and collision coverage to pay for damages to your rental vehicle.

If you use collision coverage from the car rental company, it may not cover an accident if you are speeding, driving on unpaved roads or driving while intoxicated. Also, some car rental insurance may not cover wheels and glass, so if you have a flat or broken windshield, it will cost extra. Collision coverage generally costs between $10 and $20 a day.

You might want to check with your credit card company, a lot of them will provide collision coverage. However, no credit card company provides liability coverage. Check with your credit card company by calling the 1-800 number on the back of the card. Some of the companies will not cover teenage drivers, or for luxury vehicles. Sometimes, the credit card company will pay the deductible on your car insurance, meaning you will have to file on your personal auto insurance if you are involved in an accident.

Personal Accident: This will provide coverage for your medical and ambulance bills if you and your passengers are injured in an accident. It also pays a one-time payment in the event of death or maiming. This coverage typically cost $1 to $5 per day. This is generally included in your personal auto or health policies and may not be necessary to purchase additional coverage.

Personal Property: This will reimburse you for the cost of personal items stolen from your vehicle. Some home owner and renter policies will provide this coverage. Check with your agent before you go on the trip. This coverage costs between $1 and $5 per day.

Do you need car rental insurance coverage? You might. Check with your insurance company. If you do not need the coverage, it can save you between $20 and $50 a day.