Do You Need to Buy Insurance to Rent a Car? It Depends…..
It depends on where you are traveling:
If you will be traveling outside of the US or Cananda your personal auto policy will not provide coverage. Check out www.auto-europe.com for information about driving requirements and rental programs in Europe and other countries around the world.
It depends on how much you want to spend for peace of mind:
Most CDW/LDW fees charged by rental companies are considered to be outrageous, but they can save you from inconvenience and lost time and money if you have an accident while on vacation or business.*
There are 3 sources of Coverage for Damage to a Rental Car:
1. Coverage provided by your own Auto Policy (Be sure to take proof of your insurance and your company’s claims phone number with you on your trip.)
Under Minnesota insurance laws, automobile policies issued to residents of the state that provide liability and no-fault coverages on private passenger vehicles, must also provide coverage for damage and loss of use to vehicles the named insured may rent on a daily or weekly basis in the US and Canada. Wisconsin residents who have an auto policy with collision coverage and comprehensive coverage and who rent a car for personal use are usually covered for damage to a rental car under their personal auto policies.
2. Coverage provided by your credit card
Call your credit card company to find out what insurance your card provides. Levels of coverage vary.
3. Coverage you can purchase at the rental car counter
Collision Damage Waiver (CDW): Sometimes called a Loss Damage Waiver (LDW), this coverage relieves you of financial responsibility if your rental car is damaged or stolen. The CDW may be void, however, if you cause an accident by speeding, driving on unpaved roads or driving while intoxicated.
Liability Insurance: If you have adequate liability coverage on your car or an umbrella policy, you may consider forgoing this additional insurance.
Personal Accident Insurance: This provides coverage to you and your passengers for medical/ambulance bills, but may be unnecessary if you are covered by health insurance or have your own auto policy.
Personal Effects Coverage: This provides coverage for the theft of personal items in your car. However, if you have homeowners or renters insurance, you may be covered for items stolen from the car, minus your deductible.
*Rental agreements may allow the rental company to immediately charge your credit card for damages and may require you to reimburse the rental company for administrative expenses not covered by your personal auto policy. Ask for an advance copy of the rental agreement in order to determine your contractual obligations for damage.