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Does my american family insurance cover car rentals

If you're renting a car, think about what you need before you purchase supplemental insurance or a damage waiver.

Whether you're on a trip and need transportation in a different city or your car is in the shop and you need a set of wheels to get to work and back, chances are you'll need to rent a car. That's the easy part. But, if you're like many of us, it becomes more difficult when you're faced with the decision of whether to purchase the additional insurance or damage waiver often offered by the rental car company.

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To help you decide whether you should opt for the insurance offered by rental car companies, consider the following.

Do You Already Have Auto Insurance?

Generally, your personal auto insurance should extend to a rental car. A rental car most likely would be covered by Collision coverage or Liability coverage, depending on the state in which your policy is issued, because you're temporarily driving it and you don't own it. Basically, your policy will treat a rental like your primary vehicle while you're in possession of it.

If you're looking for more coverage, you may want to consider purchasing the additional insurance offered by a rental car company.

Do keep in mind that you may not be able to rent a car at all if you don't have auto insurance, as several major car rental companies may require you to have it.

Rental Coverage on Your Policy Does Not Cover Damage to or Caused by Rental Cars

If you have Rental Reimbursement coverage on your policy, you can only use it to rent a car if your personal vehicle on your policy is in the shop because of an accident. Rental coverage does not cover damage to a rental or damage caused while you're driving a rental.

What Does Additional Coverage Actually Cover?

Make sure you know what's covered if you purchase additional coverage from a rental company. Common coverages offered by rental car companies include a damage waiver, supplemental liability, personal effects coverage and personal accident insurance. In general, each provides different types of protection, as noted below. Please note that these descriptions are for informational purposes only, and coverages may vary between rental car companies.

  • Damage Waiver – If your rental car is damaged or stolen, this coverage will apply. However, you may not be able to use it for accidents caused by speeding, driving on unpaved roads or driving while intoxicated. If you already have Comprehensive and Collision coverage, this coverage may duplicate coverage you already have on your own personal auto policy.
  • Supplemental Liability – Provides additional liability protection, generally up to $1 million, if someone makes a claim against you while you're driving a rental car. For instance, Supplemental Liability would apply if you're at fault for an accident and the other party files a claim against you for injuries and vehicle damage that exceed your regular policy limits. Supplemental Liability coverage may also provide Uninsured and Underinsured Motorist coverage, depending on the company selling it. If you already have adequate liability coverage on your car and an umbrella policy if you own your home/auto, you may want to forego this coverage.
  • Personal Effects Coverage (PEC) – Protects items and property you own if they're damaged. If you have homeowners or renters insurance, you may already have coverage, though a deductible may apply.
  • Personal Accident Insurance (PAI) – Covers your injuries while you're driving a rental. If you already have health insurance or adequate medical coverage under your auto policy, this coverage may be unnecessary.

With both PEC and PAI coverage, only you and your passengers are covered — if you're at fault for an accident, PEC and PAI would not apply to any damages or injuries caused to other parties.

Cost of Additional Insurance

If you choose to purchase the damage waiver, personal accident and effects coverage, or supplemental liability protection, you could pay twice as much for your rental. Often, these types of coverage can cost up to $25 or more each, in addition to the base price of your rental.

Are You Covered Elsewhere?

Sometimes, credit cards offer protection for rental cars. If you're using a credit card to rent a vehicle, check with your credit card company to see if and what type of coverage is offered. It may be a built-in perk of your card, in which case you may not need to pay extra for the same type of coverage offered by the rental car company.

Remember: Be sure to ask questions and verify what's covered before you purchase additional insurance from your rental car company. Only you can decide what's best for your financial situation and peace of mind.

Car Rental Tips:

Before you rent a car, consider the following:

  1. Talk to your insurance agent or company. Your first step should be to find out if the coverage you have on your personal vehicle will provide protection for you in a rental car.
  2. Check with your credit card company. Some credit card companies provide coverage at no charge if you use their card to charge the cost of the rental.
  3. Take your personal auto insurance policy and details of your coverages with you to the rental car counter. You may be asked a question that these papers can answer-or, if you're in doubt, have your insurance company or agent's name and phone number readily available.

The information in this blog may vary based on your particular state or situation. Always refer to your insurance policy for your specific coverages.


Car insurance ncd proofYou’re standing at the rental car counter with a long line behind you. You got a great rate on a car for the week, and you’re ready to go on vacation with the family. Then, you’re handed a clipboard with an intimidating rental car contract filled with confusing insurance options. Suddenly, you wish you’d spent less time packing and more time researching rental car insurance.

Here’s your chance to be prepared at the rental car counter so you can be on your way faster, and you’ll keep the people in line behind you happy.

I have car insurance. Do I really need to buy their coverage, too?

This is the most common question when it comes to renting a car for domestic travel. The answer is: it depends. You want to make sure you’re covered, but you also don’t want to pay for unnecessary duplicate coverages that could double the price of your rental.

The first step is to check your auto insurance policy, or contact GEICO to see what type of coverage for rental cars may already be included in your personal auto insurance. If you carry comprehensive and liability coverage on your personal car, coverage typically will extend to your rental car. If you’re renting a car of similar value to your personal car, in all likelihood the insurance coverage will be adequate for the rental. But if you’re off to a blowout beach weekend in a slick set of wheels like a Corvette Stingray and you’re leaving your 2008 Subaru Forester at home, the extra coverage offered by the rental company may be a good idea.

You should also check with the credit card company—the credit card that you’ll be using for your car rental. If there are any gaps in coverage with your personal auto policy, the credit card company could provide secondary coverage.

Rental Car Coverage Defined

Know before you go. Most rental companies typically have a short, predictable suite of offerings. Check your auto insurance policy to make sure you’re already properly covered and you may be able to decline the offered coverage at the rental counter.

Insurance You May Have Already

Liability coverage. This is a basic component of most car insurance policies. If you have adequate liability coverage on your own vehicle (check with your insurance provider), you may choose to skip this one.

Personal accident insurance. This covers your medical bills in the event of a crash in the rental car. As long as you have personal injury protection or medical payments coverage on your auto policy and reliable health insurance, you may not need this coverage.

Protection You Might Need

Collision Damage Waiver (CDW)/Loss Damage Waiver. This is not an insurance product, but rather a waiver that transfers financial responsibility from you to the rental car company in case of damage or theft. In most cases, waivers also provide coverage for “loss of use” if the rental car company charges for the time a damaged car can not be used because it is being repaired.

Personal Effects Coverage. If you have a homeowners, renters or condo policy, your personal items will generally be covered even if they are stolen from a rental car. Review your policy documents to be sure before you elect or decline this coverage.

Next steps: To learn more about your policy and car rental coverage, call us at 1-800-841-0728 or review your policy documents on geico.com.

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Does my car insurance cover a rental car?

Does my car insurance policy cover me when I get a rental car on vacation? The car rental company's insurance is expensive and I don't want to buy it if I don't have to.

Rental car insurance is always a sticky issue because of the differences in rental car company contracts and the wording of your personal auto policy. Since each rental company has different verbiage in their contract, and each car insurance policy is a little different, we'll be talking generalities below and leave it up to you to find out the specifics for your situation.

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Since you have a personal auto policy, you may have coverage that extends to your rental car. Most car insurance policies have wording that provides physical damage coverage to any 'non-owned auto' which is defined as any private passenger auto, pickup, van or trailer that is not owned by you or any family member and is being operated by you or any family member (this is not exact wording). A rental car fits into the definition of a non-owned auto, so physical damage coverage would apply either primary or excess IF you carry physical damage coverage on any of your own vehicles. If you only carry liability coverage on your personal auto policy, there would be no physical damage coverage provided to a rental car.

Please note: If you noticed in the definition of 'non-owned auto', there was no mention of truck, jet ski, 4-wheeler, motorcycle, etc. Your personal auto policy does not provide coverage for these types of vehicles. So the next time you rent a U-Haul truck or other vehicle that does not meet the definition of 'non-owned auto', make sure you check with your insurance company to see if any coverage applies.

Some states actually provide coverage for rental cars under the liability, rather than physical damage, section of the policy. This can cause issues if you have a low physical damage liability limit of say $10,000. Most rental cars have an actual cash value of more than that, so your coverage under the liability section of your policy would be limited.

Two states currently allow you to purchase endorsements to your personal auto policy that extend coverage specifically to rental cars. It's your responsibility to find out how coverage applies in your state, so if you're going to be renting a car, contact your current car insurance company (not your agent) and see what coverages will apply.

You may also want to contact your credit card company to see what rental car coverage may be available if you charge the full rental cost to your credit card. Many cards provide some limited coverage on an excess basis, which is not good coverage, but at least it affords some protection.

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There are many insurance issues and gray areas surrounding car rental. If you have any doubts about whether you have physical damage coverage, purchase the Loss Damage Waiver (sometimes called Collision Damage Waiver) from your car rental company. This allows you to drop off the car and walk away, regardless of the damage you did to the rental car. As long as you did not violate the terms of your rental contract, the waiver will save a lot of potential hassle if you damaged the rental car.

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