Do I Need Car Insurance For A Car Rental?

To or not to get car insurance on a car rental is a question that has been in the mind of car rental company owners and clients for a long time.

Most rental companies offer insurance packages over the counter for their clients, such as, who then have an option of using the company’s cover, or their personal cover. This decision can be reached by weighing a number of options for the individual.


Below are a number of points to keep into consideration when deciding on whether to have car insurance on a rental car.

In the case of a crash

Accidents happen, and in the case of an accident with a rental car, there are two different outcomes, depending on the insurance type. When using the rental company’s insurance cover, there is a waiver, which is also called collision damage waiver, which eliminates the liability of the collision from the customer. In the case of personal cover, the customer’s personal cover takes over, and the customer has to face their deductible.

Damages done to a third party

Damages to the third party are damage done to another person’s vehicle or property, in the case of an accident. When covered by the rental company’s policy, there is a full waiver, where the company pays for the damage, up to a common limit of $1 million.

the case of a personal own policy, the personal policy will cover the damage up to the level of your coverage limit. It is greatly advised for individuals with a personal cover which has a minimal coverage to buy the supplemental protection, which boosts up the personal cover, enabling a full cover in the case of damage to third parties.

Personal injuries

Personal injuries are those incurred as a result of an accident when using the rental car. In the case of the rental company’s insurance policy, it pays for the full medical costs for the driver and passengers. This will include ambulance and burial benefits in the case of a fatal accident.

In the case of a personal cover, a health insurance will cover the medical costs, but the customer will need to have a separate life insurance cover for death benefits.

In the case of loss of personal property through theft

During the rental car usage, there is a risk of loss of personal property such as phones and laptops which are in the vehicle through theft. In the option of the rental company policy, the cover will pay for personal property lost in the rental vehicle. This is up to a certain limit in dollars.

In the case where the customer opts not to use the rental company’s cover, their personal homeowner or renter insurance covers the claim on possession lost even away from home. This, however, will be dependent on whether the client has a police report or not.


Making a choice on whether or not to take up insurance on car rental should be made after certain considerations such as financial impact and risk possibility.

There are many companies which offer rental car cover, as proposed by and most at lower rates than the rental companies.