Rental Car Insurance
March 9, 2005 6:20 PM   Subscribe

Is the extra insurance offered by rental car agencies really needed, or is it just a big scam?

I always go for it, but that extra $10 a day can really increase the price. My personal car insurance company (Progressive) really doesn't say one way or another. I've searched around on the web and all I can find is wishy washy non-commital answers. I want to know once and for all.
posted by o0o0o to Travel & Transportation (16 answers total) 1 user marked this as a favorite
 
My policy with Progressive specifically covers rental cars. (Of course I would be responsible for the deductible on my policy)
posted by reverendX at 6:27 PM on March 9, 2005


Big Scam.

I used to work at Enterprise (albeit as a carwasher, but anyway...), it's nothing but a big money maker, like coverage plans at Best Buy, which is why they push it so hard (even making you initial that you've refused it). Often personal car insurance covers rental cars, and technically it's not insurance, just "coverage." Avoid it unless you plan on trashing the car.
posted by cosmonaught at 6:35 PM on March 9, 2005


Get an insurance agent that will tell you why you need the insurance, or why you don't. Or deal with the extra charge, and possibly lower insurance rates.

My current policy covers rentals and just about everything else with a high deductible. If I travelled more, I'd get a lower deductible. If your agent can't answer this, you need a new agent.

FWIW, I'm with a Progressive agent, but he is also a client of my business, so YMMV. Before this, I was with State Farm, and insured for everything under the sun, but I payed a lot more.
posted by bh at 6:36 PM on March 9, 2005


Just as the reverend said, usually your own insurance will cover you above your deductible. You will want to check with your credit card's provisions on the possibility that you are getting coverage by using a particular credit card as well
posted by pablogrande at 6:36 PM on March 9, 2005


If you reserve and rent the car with an American Express card they cover loss and damage.
posted by splatta at 6:47 PM on March 9, 2005


AmEx (also Visa and Mastercard -- any major CC issuer does it) only covers damage to the car you rent, not the car you hit, or anything else fo that matter. I rented a car in September, forwent the insurance, and got in the second accident of my life, and have been through the ringer since. It would have been easier if I took the insurance, and then the rental car company would have taken care of everything: in the future I plan to always get the rental car insurance.
posted by scazza at 7:11 PM on March 9, 2005


Ok, I called Progressive to find out... the deductible for comprehensive is $500, for collision $1000. Yikes!

That certainly makes it more of a gamble. Maybe I am better off with the "optional" coverage after all?
posted by o0o0o at 7:15 PM on March 9, 2005


Various credit cards cover rental car insurance, and if you rent often, it is worth paying an annual fee, assuming you aren't covered by your normal car insurance. When we lived in Germany we had no car, so paid for a good credit card as we frequently rented for out-of-town trips.

Be very aware, rental car companies can be total asses when it comes to things like dings in the windshield! They will charge for total replacement of the window, even when it is well known that its better to repair such dings. If you don't spot it before you drive away, its your fault. We spent months fighting with Avis over this! We had rented with an award voucher that included insurance, but the repair was below the deductible.
posted by Goofyy at 7:40 PM on March 9, 2005


Comprehensive and collision are really not the issue. If you trash the car, you might be out, what, $20,000? That's terrible, sure, but it's not going to end your life as you know it.

If you run somebody over, however - or if the car has a mechanical flaw and you plow into a crowded storefront, breaking several people's necks and damaging all the merchandise, to take a hypothetical worst case - you could well be found liable for tens of millions of dollars in damages (depending on the laws where you are, of course). If you're not insured, you could well lose everything you own and have your wages garnished for the rest of your life. Coverage for this sort of thing is called 'liability' and it's very important. You should never get behind the wheel of any car without knowing exactly who is providing your liability coverage and how to reach them in the event of an emergency.
posted by ikkyu2 at 7:44 PM on March 9, 2005


I always get the "coverage" but that's because I do not have car insurance. That's why I rent vehicles in the first place. ;)

It does make the rental more expensive (sometimes twice as much) but if anything does happen, it is an extra level of coverage (even if problematic). For instance, $50-100 more on rental vs. $10000-20000+ more in damages.

Sure it's probably a scam, but what insurance coverage isn't.
posted by purephase at 8:10 PM on March 9, 2005


Do you want to bet them that you will crash the car? That's basically what it boils down to.

The agent I rented from last week was so busy telling me how bad the drivers were in the state I was visiting that he didn't tell me the car had a satellite radio in it, which would really have helped in some of the desolate areas we drove to.
posted by britain at 8:16 PM on March 9, 2005


Purephrase, having an insurance policy isn't necessary. Check around with your credit cards. As long as you're carrying a credit (not debit) card, odds are your rental car is fully covered by them.

Someone with an old clunker may not be carrying comp and collision. In that case, buying the rental company's supplemental can make some sense since those late model rental cars are a whole lot more expensive to fix/replace if there's trouble.
posted by nakedcodemonkey at 10:06 PM on March 9, 2005


Here's an idea of how much of a scam it is: I dutifully bought insurance whenever I rented a car, often paying a couple hundred dollars per week extra on long rentals, and I never needed it once in 6 years of renting cars several times a year.

In early 2004, I realized that for economy rentals it almost doubled the price and that I would just throw caution to the wind and rent without it from now on. I rented cars about a dozen times since then and I had one actual mishap for the first time. While parked in a hotel parking lot, someone smooshed the bumper on a van they gave me. In the end, it cost me $250 which I paid happily, knowing that I would have paid much more than that if I got insurance every time I rented.
posted by mathowie at 11:31 PM on March 9, 2005


My advice: when they start to ask you about extra coverage just smile and say 'no, no and no.'

Your car insurance should cover you at the same limits and with the same deductible as your cars at home. So, assuming you have full coverage on your regular car, you're already covered. Also, as a number of people have noted, some credit cards offer automatic coverage as well.


I thoroughly destroyed a rented Lincoln while in Washington a few years back. An RV crushed the rear while it was in a parking lot, and we were hiking. I wound up tearing the front bumper and grill off and leaving them on the side of the road after a deer jumped in front of us while I was going about 70mph. To cap it off, a truck flicked up a stone just right, and spidered the windshield.

AmEx and Hertz took care of everything, no problems for me except for the odd looks that the valet at the Inn at the Market gave us, as our car came back slightly more destroyed each day.
posted by mosch at 12:06 AM on March 10, 2005


Helpful info from Nolo.com (which calls the insurance a consumer rip-off) and articles here and here from SmarterTravel.com.

I could be reading them wrong, but they seem to indicate that most states require the rental agency to carry insurance that covers damages caused to others by the renter, which means you're not un-covered for that if there's an accident even if you decline all their coverage.
posted by occhiblu at 8:58 AM on March 10, 2005 [1 favorite]


the deductible for comprehensive is $500, for collision $1000

Here's the deal - if you pay (say, only) $10 extra per day to the car rental agency to avoid these deductibles, your break-even point is 150 days of rentals. If you think you can drive 150 days, on average, without an accident, then you're better off putting each day's $10 into savings. But there is a caveat to that principle: If you're the kind of person who lives paycheck to paycheck (by necessity, or otherwise), has no savings, and can be presumed not to be likely to build up savings, then - unfortunately - your best course of action may be to pay the $10 each time even if you're a good (accident-free, historically) driver. In other words, a constant set of small hurts is better than risking an accident (that is, having to pay the deductible) if such an accident would really be problematical.
posted by WestCoaster at 9:52 AM on March 10, 2005


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