To Insure Your Rental Car or Not
If you've ever rented a car, you know the drill. The rental clerk recites an ominous list of expenses you could be liable for should you return the car with a dent or ding. The insurance costs a fortune, but declining the coverage can cost you some sleep. An ABCnews.com story said that about one-third of renters opt for the insurance even though many "end up wasting money."
Matt's View
The key to a smart decision is knowing what coverage you already have. I found out from my insurance agent that, for the most part, all coverage on the vehicle I own is the same for a car I rent. The one exception is that if I'm in an accident with a rental car, the rental car company will charge me a daily rental fee for every day that the car is being repaired ("loss of use"), and that would not be covered.
I then checked with my credit card company, which offers free "secondary" insurance. That means it covers anything not covered by the policy on the car I own, such as the deductible. However, loss of use turns out to be a gray area. The card company rep said technically they do cover that, but only if the rental car company provides adequate documentation, which it rarely does (how's that for an honest answer?). Two other surprises from my credit card company: it only provides coverage if I rent from one of three companies, and it does not provide coverage for full-sized SUVs.
Planning to rent a car? Call your insurance agent and credit card company first.
Managing Money by The Book
- "I delight in your decrees; I will not neglect your word." - Psalm 119:16
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