Should you spend the $10 a day or more that many car rental firms now charge for collision damage waivers? Yes. No. Maybe.
Any of those answers could be the correct one for you, depending on the terms of your own automobile insurance policy, say insurance companies and state officials who keep an eye on insurance issues. While most auto protection policies extend at least some coverage to rental vehicles, coverage may vary significantly from company
to company. And there could be circumstances in which you’d want to have the collision damage coverage from rental firms, even if it were duplicated by your own motor vehicle insurance, the experts say.
It’s a good idea to check with your insurance agent before you buy a waiver, That’s really true if you’re going on an extended trip where the costs are going to mount up. The stakes in your decision are higher than they used to be because lately most car rental companies have increased their fees for collision protection and did away with limits on customers’ liability for accidents. The changes have prompted the auto insurance industry to lobby in state legislatures across the U.S. for regulation of collision damage waivers as a form of insurance.
If that happened rates for the waivers would be subject to review. Here’s how a collision damage waiver works: The rental customer pays a certain amount of money per day in return for a guarantee that, if he damages the car in an accident, the rental company will pay for it. It’s entirely up to the customer whether he buys the waiver or not.
Further, many now have no limit on liability, meaning that if you wreck a $30,000 rental car, you or your insurance company may have to come up with $30,000. Still, there’s no need to worry about the higher prices if your insurance agent says you don’t need the waivers, right? Well, perhaps. Generally, if you rent a car and have an accident and you’re at fault, you’re covered by your own liability insurance. Most auto insurance companies provide substantial coverage for policy-holders who happen to be driving a rented vehicle when they are involved in an accident. In general, firms which extend coverage to rental vehicles do so in the same amount as the owner’s car, with the same deductibles.
However, there may be exceptions, and you should ask your agent about them. For instance, are you insured only up to the value of your own car? What happens if you crack up a rental car that’s worth more? than your vehicle? Is there a ceiling on the repair costs your auto insurance company will pay if a rental vehicle is involved? Does your policy cover rentals in foreign countries?
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