How often do you need to rent a car? Those of us who travel regularly for work or vacation might rent several a year. But many people can go a few years without needing a rental. For those who don’t rent cars very often, the question of whether or not to purchase the optional insurance can be very unsettling. The offer feels like a hard sell. Usually, the question comes up right after you walk around the car with the agency representative to confirm every existing blemish. Now there is a lot of pressure to purchase insurance, because they have shown you how carefully they’ll inspect the car upon its return. As the question hangs in the air, you visualize kicked up pebbles and parking space door dings. How much are they really going to charge for a scratch? But what if it’s worse – what if you would get into a fender bender? Will your existing car insurance provide coverage? In the moment, it can be a little overwhelming. Most people make a snap decision one way or the other, and then drive off hoping it was the right one. In the interest of being better prepared next time, you decide to look into whether or not you really do need the coverage.
What is a Collision Damage Waiver?
Rental car companies offer a collision damage waiver (CDW) or loss damage waiver (LDW) to cover the cost of repairs if the car is in an accident or gets damaged in some other way. To manage the inherent risks associated with having cars on the road, they determine that you are responsible for any damage your rental car sustains. The insurance is called a waiver because they are essentially waiving your financial liability for the repairs. Rental companies thoroughly inspect cars when they are returned, and they will charge the customer if they find damage. They have your credit card on file with your signature agreeing to additional charges. If you added the CDW to your rental agreement, you will not be charged for the repairs.
What Are the Rental Car Coverage Options?
The CDW is a straightforward policy that exists for the temporary period of your rental agreement. If you don’t rent cars very often, don’t have the budget for unexpected expenses, and tend to be nervous about borrowed property, the coverage is probably a good idea. If something happens to the car, you can walk away without any concerns that it will affect your wallet or your personal insurance status. The CDW is not your only option, however. Many credit cards, especially those marketed for travel, come with built-in rental car protection. If you rent cars frequently for business or vacation travel, there are some credit cards that offer benefits and features specific to your needs. Read the terms and conditions for your card rather than relying on the overview. The coverage might require you to decline the CDW from the rental company, and it also might require certain charges for the car to be placed on the card. Of course, you also have your own auto insurance policy to consider. Call your agent before you make travel plans to review your coverage and options. Your policy has a deductible for comprehensive or collision damage, and your rates might be affected by a claim. If you work with a local, experienced agent, they will help you evaluate the risks and benefits of relying on your existing policy versus adding the CDW.
What is Covered When I Rent a Car Through Insurance?
Your auto insurance agent might already know about your rental car. If your personal car is in the shop for repairs after an accident, your policy might cover the cost of renting a car for a few weeks. Rental car reimbursement coverage is an affordable add-on to your auto policy that allows you to keep up with your daily commute and errands while your car is being fixed. If you are using an insurance claim to pay for your rental car, you will not need to add the CDW. When an insurance company is paying the bill for the rental car, it is fully covered under that policy. The main frustration most people face in the process of renting a car is dealing with unexpected fees. As consumers, we plan budgets around advertised prices, and somehow the cost always goes up from there. While it’s pretty much impossible to avoid extra fees, it is possible to prepare for them ahead of time. If you have upcoming travel plans, or you’re just curious about what your auto insurance policy actually covers in a rental situation, contact us. We educate, nurture, and empower individuals through insurance so that they can manage their expectations when making financial decisions. Smyrl Insurance is happy to answer your questions about car insurance, rental coverage, and which options are best for your circumstances. We serve clients for auto, homeowner, renters, life, and other types of insurance needs in Hatfield, Lansdale, Souderton, Harleysville, and throughout the region in Montgomery County and Bucks County, Pennsylvania.
