Many vacationers rent vehicles, but they may not be aware of what rental insurance they will need. Faced with several choices at the counter, some renters either purchase all the insurance policies or decline insurance without knowing if they already have coverage.
This costly mistake can result in either wasting money by purchasing unnecessary insurance or having gaps in coverage.
Before renting a car, you should make two phone calls — first, to your insurance agent, and second, to the credit card company you will use to pay for the rental. That way, you will know what coverage you already have.
Rental car insurance offers four essential coverages:
- Loss Damage Waiver (LDW), also referred to as a collision damage waiver, is not technically insurance. It relieves or “waives” renters of financial responsibility if a rental car is damaged or stolen.
- Liability Protection provides financial protection from lawsuits if you are sued following a rental car accident.
- Personal Effects Coverage provides insurance protection for the theft of personal items in your car.
- Personal Accident Insurance will cover you and your passengers for medical and ambulance bills incurred by injuries in an automobile accident.
To learn more, read our article “Rental Car Insurance – Should You Buy It?“