Does My Car Insurance Cover Rental Cars?

Anyone who’s rented a car knows that moment of minor panic that occurs at the rental counter, when the agent asks if you’d like to add insurance to your reservation. “Does my auto insurance cover rental cars?” you likely have asked yourself. “Do I even need insurance for a rental car?” 

It’s a great question. The conundrum of car rental and insurance coverage is often a little confusing, and it can be tempting to just skip over the question. Besides, who knows — even if you have liability car insurance, rental car driving can present an extra set of questions. Would your coverage be enough if something happened while you were driving the rental car? Is it necessary to buy insurance through the rental car company? 

Here’s what you need to know to decide whether it’s necessary to buy rental car insurance — no more panicking at the counter! 

And if you’re thinking about purchasing auto insurance, reach out to Farm Bureau for help selecting a policy. 

How to Know if Your Car Insurance Covers Rentals 

Here’s the good news: The rental company offers insurance options that may overlap with insurance policies you already have if you carry an auto insurance policy. But don’t take that for granted. Each insurance policy is unique, and you should always check with your insurance agent prior to renting a car to make sure that you have the coverage you might need.  

When you talk to your insurance agent, here are the coverages on your policy that you should explore to determine whether you should purchase rental car insurance. 

1. Liability Insurance 

Almost all states require drivers to have automobile liability insurance to cover injuries to another driver and damage to others’ property if you’re involved in an at-fault accident. However, if you only have the minimum legally required liability coverage, you may want to increase your coverage while renting a car and even when driving your own vehicle, to ensure you are properly protecting yourself. 

2. Comprehensive and Collision Coverage 

If you have auto coverage, that means you have comprehensive and collision insurance that provides coverage to your automobile for incidents while you’re driving (such as hitting a pole) or when you’re not driving (like storm damage or theft). You should check with your auto insurance company to determine if your coverage covers rental cars. In the event of an accident involving a rental car, you would most likely still be required to pay your insurance policy’s deductible. 

However, here’s something to watch out for. Even if the damage to a rental car is covered by your insurance, turning down rental protection offered through the rental agency may make you liable for lost income to the rental company if a car you’re driving has to be taken out of commission for repairs, as well as any diminution in value of the vehicle involved in the accident. 

3. Injury Protection 

If you have health insurance, any kind of personal injury protection (PIP) or MedPay, the injury protection offered through the rental company could be redundant. 

4. Homeowners or Renters Insurance 

What if your possessions are stolen from a rental car? If you have homeowners or renters insurance, coverage would likely extend to any personal items that are stolen from a rental car, but be sure to file a police report. It’s important to keep in mind that the deductible on your homeowners or renters insurance policy would also apply. 

5. Credit Card Coverage 

Not everyone carries an auto insurance policy — for instance, you may not have a car and thus may not regularly drive. However, you may have rental car insurance through your credit card company if you use the card to pay for the rental. Call the phone number on the back of your credit card to determine if this is a service they provide, and the level of coverage they provide. 

6. Travel Insurance 

If you have purchased travel insurance, car rental collision coverage may be included. But make sure you confirm what is covered — you never want to assume a higher level of protection than is actually provided. This type of coverage is typically secondary insurance, meaning it would pay out only after your primary auto insurance. Therefore, you may not want to forego this additional coverage if this is the only other form of insurance you have.   

Sometimes It’s Worth It 

If you don’t have coverage — perhaps you don’t own a vehicle or have protection through a credit card — you should purchase insurance either through the rental agency at the counter or a third-party provider before you pick up the car.  

Here are some cases when it may make sense to purchase rental car insurance from the car rental agency: 

• If you have a high-deductible health insurance plan, you may want to explore the insurance options at the rental agency, as you may be able to secureinsurance witha lower (or no) deductible.
• If you have minimal coverage or are renting a car worth significantly more than your personal car, you should considerpurchasingadditionalcoverage through the rental agency.
• Any claim made against your personal auto insurance mayimpactyour premium; ifthat’sa concern, consider purchasing additional coverage.
• If you are traveling for a significant length of time, you should confirm with your insurance provider that there are no time limits on rental coverage. 
• Additionally, if you are traveling for business, you should confirm that your personal insurance will extend to the business rental.

Are you out of your home country? Your policy may not extend to overseas rentals, and some local laws may prevent you from leaving until you’ve paid for any damages. Make sure that any travel to a country outside of your home country is covered by contacting your insurance company directly. 

Remember, most auto insurance policies purchased through a rental agency are relatively inexpensive, and you’re normally not paying for them for very long. If you are concerned about your coverage, the amount you pay to be covered through the rental agency may be worth it for your peace of mind. 

Connect With an Agent

The best thing you can do is to be informed about what your policies cover before you step up to the rental counter. If you already work with a Farm Bureau agent, contact them directly to discuss your policy. If you work with another company but would like to explore new options, reach out to Farm Bureau today.