One thing I like about renting a car is that it allows you and your family to visit new parts of the world, drive long distances, and stop whenever you want to take in the beautiful views. But the best feeling of all is when you return the car to the rental company without a single scratch or dent. You can proudly say, “Go ahead, check it all over, you won’t find a thing!” But, what happens if you do get into an accident or have a bump? What kind of car insurance do you need, and what is just the rental company trying to sell you extra coverage that you don’t really need? In this guide, I will talk about car rental insurance in USA for foreigners who are just coming here. Let’s find out!
The best way to go on a road trip is to hire a car. You get to enjoy the open road, the sunshine, and the freedom to go wherever you want. But, there is always that fear in the back of your mind – what if I get into an accident, or what if I get stuck on the side of the road in the middle of nowhere? The way to protect yourself from these fears and enjoy your trip is to get insurance coverage. But, this can be tricky, and rental companies often try to take advantage of your fears to make some extra money.
Note that I’m not a lawyer or a financial expert. I’m just someone who has rented cars many times before. So, you should be open to making your own decisions about what works for you. You are only going to learn some do’s and don’ts and some top tips to help you make those decisions.
Car Rental Insurance USA for Foreigners: Is It Worth It?
What kind of insurance coverage do you need to get through a rental company? Sometimes, the answer is none! You do need to have certain insurances, but you don’t need to buy them through the rental company. There are many different places you can go to get insurance coverage. You can go through your travel insurance, your car insurance, your credit cards, etc.
You don’t need to buy insurance coverage from the rental company. But, you do need to make sure you have some kind of coverage in case something happens because it’s better to be safe than sorry. There are a few that are really important, and I’m going to go through them with you.
1. Collision Damage Waiver (CDW)
The first one is the Collision Damage Waiver, also known as the Loss Damage Waiver. This is probably the most important one, because it covers the car if you get into an accident. So, if you’re driving along and you get into a crash, this insurance will help pay for the damages to the car. I have written about the collision damage waiver with Enterprise – you should check out this article.
2. Liability Insurance
The next one is Liability Insurance, which is also very important. This covers third parties and anyone else who might be involved in an accident. So, if you’re from the UK, for example, these two insurances are often included in the price of the rental car. But, if you’re from the USA, it’s not usually part of the deal, so you’ll need to check your personal motor insurance policy to see if you are covered.
If you have Collision and Comprehensive coverage on your personal motor insurance, you should be okay. But, you should also check to see if your policy covers you for Loss of Use fees, which the rental car company might charge you if they’re losing income while the car is being fixed. Most policies do cover this, but I advise you to double-check.
Companies with Credit Card Coverage
In the US, many credit card companies offer car rental insurance as a perk. This can cover things like Collision Damage Waiver and Loss of Use fees. However, it’s not a substitute for Liability Insurance, and it won’t cover medical bills or property damage. And, it’s only valid for short-term rentals, so you’ll need to check the details of your credit card policy.
You need to remember to book your car rental using that credit card in order to unlock those perks. And, every credit card is different, so you’ll need to check the details of your policy to see what’s covered.
Insurance You Might Not Need
Well, the answer is that all of the insurance options are good, so it’s always better to get as much coverage as you can afford. But, you may already be covered for some of them. For example, Personal Accident Insurance, but if you’re a holidaymaker, you should already have this as part of your travel insurance. In the USA, you should be covered by your personal health insurance and/or your motor coverage.
Personal Effects Cover is another one that’s nice to have, but travelers should already have this as part of their travel insurance or their home insurance. People from the USA should be covered by their household insurance too. Check what you are already covered for before you start buying extra insurance policies.
Separate Car Hire Insurance
What if your personal insurance or credit cards don’t cover any of the extra insurance I mentioned earlier? If you book through an American company, you’ll need to get coverage for all of those elements I spoke about. However, you can buy car hire insurance completely separately from your company. Just make sure you buy the right one, because it can be a bit confusing.
Let me tell you a true story…
A few years ago, I booked a car hire insurance policy and thought I’d gotten a great deal. I paid around $40 for 6 weeks of coverage for the whole family, and I thought I’d covered all my bases. But, literally just 3 days into the trip, I was parking the car around the back of a restaurant, and I misjudged the curb. The bumper was scratched underneath. I had to force myself not to think about it for the rest of the trip because I was so worried about the cost of repairs. When I got back from the trip, I found in the documents that I hadn’t actually bought the coverage I thought I had.
I was only covered for excess insurance, which is like minor scrapes and bumps, not for Collision Damage Waiver or Liability Insurance. It was lucky that the damage wasn’t worse!
Don’t make the same mistake. Book ahead, make sure you get the right coverage, and read the fine print very carefully.
If you need separate coverage, you can search for one online. You may be able to use a company you’re already insured with. There are specialists in car hire insurance. In the UK, you can search for the level of coverage you need on a site like moneymaxim.com. In the US, consider buying personal liability insurance separately, and get the rest of the coverage from a good credit card.
REMEMBER to check the fine print of your insurance policy. That’s the most important part. You want to make sure you know what you’re covered for and what you’re not. Don’t assume you have coverage for everything to avoid that painful element of surprise when you need to make a claim. Take your time, do your research, and make sure you are protected.
Read Also:Â Cheapest Car Insurance for International Students in the US
