LETTER OF THE LAW: Rental Car Insurance: worth the cost?
Should I buy the additional insurance? That depends.
As a first step, I should have checked my own auto insurance policy before getting on the plane. Your own personal insurance will apply to the rental. This means, however, that if you have just basic coverage without collision, if you have an at-fault collision in the rental vehicle, you’re on the hook for repairs to the vehicle and possibly the cost to replace the vehicle if it is a write-off.
You also need to keep in mind additional fees that may be charged by the rental company for a damaged car. For example, some companies charge a daily fee for every day that the rental car is in the shop getting repaired and not available to be rented. Most personal auto insurance policies will not cover these additional fees.
But in most cases, these fees are waived if you purchase the rental company’s “collision damage waiver”. Sure there is an extra cost up front for this additional coverage but if you damage the vehicle you may save more money in the long run.
If you are going to rely on your credit card car rental insurance, make sure you call your credit company ahead of time and get a detailed explanation of what is covered and what is not covered. There may be stipulations attached to the credit card insurance that may limit your protection.
If you do decide to purchase the car rental insurance in most cases if you get into a collision you will not be required to pay the deductible for the repairs.
However, if the collision is reported to the police, and you are deemed to be at-fault for the collision, your own insurance rates will likely increase since the at-fault crash will go on your driving record.
So what to do? The best advice is to become informed of what you have and compare that with the cost of purchasing additional insurance when you rent the car.
If you are risk averse and can afford the extra cost, you may appreciate the peace of mind of having the additional insurance. Vacations are stressful enough without the added headache of worrying about insurance.
Kristian Bonn is a personal injury lawyer and partner at Bonn Law. He grew up in Trenton, works in Belleville and Trenton and lives just over the Bay Bridge in Prince Edward County.
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