Do I need to get insurance on a rental car?

The weather is starting to warm up, which means summer travel plans are underway. With families traveling to magic-filled amusement parks and companies planning in-person meetings, it’s important to feel prepared for your upcoming travel. One of the more important things on the “Don’t Forget” list is knowing how you’ll get around (transportation). 

Rental cars are generally a top pick for those traveling, but what folks may ask or not be aware of is the role car insurance plays in the rental car process. Let’s talk about that and answer whether or not you need to get insurance on a rental car.

The basics of rental cars and insurance

When you show up at a rental agency to pick up your ride, you may be wondering if you need to show proof of insurance at the counter. Most rental agencies may not require proof of insurance for a rental. However, we don’t recommend not having insurance. 

In most cases, your personal car insurance policy will extend coverage to a personal use rental car (vacation, travel, etc.) for a limited time frame—such as 14 days. When renting a car, it is important to address restrictions, like who is covered to actually drive the car, with the rental agency and your insurer.

If you opt to purchase coverages offered by the rental agency, make sure you understand what it is you’re purchasing and how they apply to you in the event of an accident or loss (e.g., theft). To dive a little deeper, you will want to know how you’re protected for:

• Liability to others if you cause an accident or injuries

• Damage to the rental car

• Theft of the rental car 

• Your own injuries in the event of an accident

• Loss of use of the rental vehicle

Many rental agencies will prioritize the protection of the rental car. Additionally, some credit cards offer perks such as insurance protection for when you use that card to rent a vehicle. Make sure you carefully consider what that protection does and doesn’t cover before opting in. 

Because rental agencies carry insurance that protects them and the car, they may offer add-on coverages that you can opt to purchase, but it’s important to understand what is and isn’t covered. 

Is a rental car covered by my insurance?

If you have an auto insurance policy, you may wonder if your insurance covers a rental car. Many, but not all, personal insurance policies will extend coverage to your personal rental car. But as we mentioned before, it may only be for a certain amount of time and only cover the driver of the vehicle (which would be you). 

The

type of travel you are going on with a rental car can also affect your own insurance coverages. If you’re renting a car for business use or renting a car on a business trip, your personal car insurance policy may not cover your trip. 

So what does your car insurance cover when renting a car? Depending on the reason for the rental car, who was driving and whether your policy provides coverage for a “non-owned car,” here are some scenarios of your insurance vs. rental agency. 

Crashes that damage the rental car and car theft

• Your policy: In most states, your Comprehensive and Collision coverages would apply, including your

  deductible.

• Rental agency: You’ll have the option to sign a loss-damage waiver, which is not to be confused with insurance.

Damage you may cause to others

• Your policy: Liability insurance would help cover any damage you may cause to others.

• Rental agency: You may be offered supplemental liability protection, which should be highly considered if you don’t have insurance

Stolen personal property

• Your policy: If you have Renters or Homeowners insurance, your policy may provide protection for your stolen property while it’s not in your home.

• Rental agency: Personal effects coverage may be offered by the rental agency for you to purchase.

As a general tip, it’s never a bad idea to give your insurer a call before renting a car or going on a trip to discuss what your policy does and doesn’t cover as it relates to a car rental and/or personal property theft. 

Can you rent a car if you don’t have insurance?

If you live in a metropolitan area or you are a college student who doesn’t have a car, you may not have car insurance. So if you’re renting a car, what should you do about being covered? Some insurance companies will sell you a “Non-Owned Auto” type of policy which protects you and covers things like damages you’re responsible for to cars you don’t own, but may rent or borrow.

As a side note, HiRoad doesn’t offer this sort of coverage. And although you may not be required to show proof of insurance at the rental agency, you may want to consider what you’re risking by not having insurance in the first place. To give you an indication, here’s a blog post on the topic of driving without insurance. 

If you’re getting ready to hit the road this summer with a rental car, make sure you’re clear on how your auto insurance or the coverages offered by the rental agency apply to you and your situation. Don’t rely on friends or family to tell you what is or isn’t covered because it can vary in big ways. Like you, your policy is unique and the terms might not be the same as your family or friends.