“Do I have to purchase the insurance when I rent a vehicle?” We get asked this question a lot at The Staples Agency. A client is planning a vacation or looking to rent a car, and they see an insurance line item at checkout. It is almost as much as renting the vehicle itself! Making that advertised price of a rental vehicle look like a pipe dream. Right around here is when we receive the call…

Do you have to purchase the insurance? Short answer, If you have physical damage coverage on your auto insurance policy, most likely you don’t. A majority of carriers will convey physical damage coverages to rental vehicles. With emerging technology and the shared economy you may want to double-check when using services like Turo, Maven, or Zipcar but your traditional rental car companies will usually have the coverages carry over. Another thing worth mentioning is that in most policy language, coverages will convey for “private passenger vehicles”. This means that if you plan to rent a bus, moving truck, or limo-style vehicle, your auto policy’s coverages are not valid and you should absolutely purchase the offered insurance plan.

Now that the “have to” question has been addressed, let’s tackle the  “Should I”. Admittingly this answer comes from not only personal experience, but few instances that I have witnessed from clients over the years. A lot of my advice comes from the “If it were me, I would do this” stance, and in this scenario, I always purchase the insurance from the rental company. There are numerous reasons why. Below are a few eye opening reasons:

• Additional Fees:

When you are involved in an accident with a rental vehicle, if you use your auto insurance policy for coverage, there are additional line items that the rental car company will charge that your policy will not pay for under any circumstance. First is your deductible, that is a given. Next would be something called “loss of use”. This is the cost of lost revenue from the rental vehicle during the time it spends in the shop being repaired and not able to be rented out. There is also an arbitrary fee called “administrative expenses”. This is at the rental company’s discretion and can get pricey. These three line items have the potential to equate to a couple of thousand dollars!

• Using your policy means surcharges!

If you opt to use your policy and have a claim, it will affect your policy for years, just like it would normally. Anytime your policy pays out a dollar you stand to lose good driver discounts, and suffer claim surcharges costing you far more in the long run.

• Laws are not the same everywhere

There are times when the local laws where you are renting a vehicle differ from where you live and hold a policy. Purchasing the plan from the rental company will ensure you have coverage applicable to the local laws.

All in all, you have options when it comes to how you would like your rental vehicle covered, and ultimately it is your choice. However, if you would ever like to discuss these options in further detail, you can call any one of our specialists at The Staples Agency and we would be more than happy to talk with you about it to arrive at the most educated decision you can make.

Happy travels!