Rental Car Insurance – a Good Buy?

Summer is here and you’re vacation bound!  You found the best rate for a hotel and rental car and soon you’re flying away to your favorite vacation spot (or dreaded family reunion, but enough about my summer…).  You reach the rental car counter and they ask you if you want to buy the insurance.  As they hand you the 27-page, micro-print contract you think to yourself, “Do I really need this?” Let me help you with the answer so you can enjoy your vacation.
The short answer is “Yes”, but not to everything they’re selling.  Your Personal Auto Policy (PAP) will extend liability coverage to “any” vehicle that you drive, including rental cars.  Example: You’re driving your rental and you hit another car.  Both cars are damaged and the other driver is hurt.  A few weeks later you are notified that the other driver is filing suit against you for bodily injury.  What happens? Your policy would extend coverage to you by providing a defense and indemnification if the suit goes against you, for both the damage to the other vehicle and the bodily injury. 
But what about the damage to your rental car?  If you carry physical damage coverage on your PAP, you have coverage (after your deductible).  This is the first problem you encounter – do you remember if you carry physical damage coverage?  The next problem you may encounter is within the micro-printed contract that you signed.  Most rental car contracts will state that you are responsible for the daily rental rate of the car while the vehicle is out of service.  They also carry a provision stating that you will be charged a minimum amount before you leave the rental office, sometimes as much as $5,000, as a deposit toward that daily rental rate.  For this charge you definitely DO NOT have coverage on your Personal Auto Policy.  OUCH!  So, what if you don’t have $5,000 to give them?  And do you think they are going to be in a big hurry to fix that car if you’re paying the rental rate while it’s being fixed???  This is a serious problem and not covered by your policy.   Our solution: Always buy the physical damage waiver coverage!
Three last thoughts to consider – One, you are driving a strange car in a strange place, often with a map in your lap and sand in your shoes – the chances of making a wrong turn are greater than when you’re driving in your hometown in your trusty family car.   Two, check with your credit card carrier.  Some credit cards will include insurance coverage for rented vehicles (but read the fine print).  Lastly, you’re on vacation! Buy the insurance and the peace of mind of knowing that if you drop off the car and it’s missing a bumper and a couple of doors, your biggest worry will still be the airline losing your luggage. 
Happy Summer!
Purves Insurance is located in Davis, CA, and hopes everyone drives their rental safely!