Introduction

When renting a vehicle, you are always faced with this question:  Should you opt for the rental company’s insurance, or rely on your own car insurance? This decision can seem minor—usually, it will only require that you check a box indicating your choice—but it has significant implications in the event of an accident. This blog provides detailed guidance on navigating the complexities of rental car insurance, specifically tailored for residents and visitors in the Columbus- Phenix City area – but also should be considered no matter where you are traveling in the USA.

  1. Understanding Rental Car Insurance

Rental car insurance offers various coverage types. The most common is a collision damage waiver, which waives the renter’s financial responsibility for any loss or damage to the rental car. This coverage typically costs between $20-30 per day. Other coverages include liability coverage, personal accident insurance, and personal effects coverage; essentially, coverage protecting any valuable items you are transporting with you. Deciding whether to purchase these options can depend heavily on your existing insurance policies, the nature of your trip, and your personal risk tolerance.

  1. Making the Decision

You should consider the following while contemplating this decision:

  1. Existing Auto Coverage: Check if your current auto insurance extends coverage to rental cars. Most of the time, it does. However, it might not cover “business” travel or certain circumstances. You need to know what you have. Understanding the specifics of your policy, such as deductibles and coverage limits, is crucial before declining the rental company’s insurance.
  2. No Auto Coverage: If you do not own a car and lack personal auto insurance, purchasing rental car insurance becomes more important as it may be your only form of coverage while driving the rented vehicle. While you do not have to have an automobile insurance policy to rent a vehicle, the rental agency typically only carries minimal coverage on their vehicles. This can leave you on the hook for significant expenses in the event of a serious accident. And if you are responsible for a wreck, you can expect to be sued by the insurance company for reimbursement if a claim is made. You don’t just walk away.
  3. Business vs. Personal Trip: For business trips, your employer’s insurance might cover you, but it is important to confirm whether your employer’s automobile liability policy extends to you before relying on that coverage.  Personal trips will likely require you to depend on personal coverage and/or rental insurance.
  4. Peace of Mind vs. Legal Obligations: Sometimes, opting for rental insurance is more about peace of mind than legality, especially if your personal insurance provides adequate coverage. Assessing the potential financial and legal risks of not having comprehensive coverage is essential. For example, an over the road truck driver with a commercial driver’s license is less likely to need rental coverage than a 25-year-old student.
  5. Considerations Before Deciding: Review your current insurance documents, consider credit card benefits (as some offer rental coverage), evaluate your risk tolerance, and understand state laws and requirements where you are renting the car.

  1. Coverage in Accidents Involving Rental Cars – another puzzle

When involved in an accident with a rental car, determining which insurance coverage applies can be complicated. Typically, the rental car driver’s personal auto insurance is the primary source of coverage, and it is often the coverage listed on the police report. However, if the driver does not have personal insurance, the rental car company’s insurance may come into play. It’s important to note that rental companies generally are only responsible under specific circumstances, such as if they negligently entrusted a car to an unqualified driver. Still, it is a good idea to put the rental agency on notice of your potential claim regardless of the facts of loss.

  1. Practical Advice

Before picking up your rental car, take the following steps:

  • Review Your Insurance Policy: Know what is covered and, more importantly, what is not. (If you are not sure, call your agent – yes – it is that important.)
  • Check Credit Card Benefits: Some credit cards provide rental car insurance as a perk. Visa and AmericanExpress, for example, sometimes allow card members to purchase a rental collision damage waiver directly (or provides coverage) when using the card to rent a vehicle.
  • Assess Risk Tolerance: Consider the worst-case scenario and decide if you can handle the potential out-of-pocket expenses.
  • Legal Requirements: Understand the minimum insurance requirements in the state you are renting the vehicle. They can vary greatly state by state. In Florida, the minimum liability insurance required is only $10,000.00, compared to $25,000.00 in both Alabama and Georgia.

  1. Real-Life Examples in the Chattahoochee Valley

In Columbus and Phenix City, we have seen numerous cases where individuals faced significant challenges after accidents in rental cars due to insufficient coverage. The law office of Gary Bruce routinely handles cases where the at-fault party becomes personally responsible for thousands in damages and medical bills because the minimal coverage provided by the rental company was inadequate, and they had declined additional insurance.  The challenge often is finding coverage and avoiding trying to collect from an uninsured driver. Each case is unique. Sometimes rental companies may offer additional coverage for a loss after realizing the renter should not have been allowed to rent a vehicle. This is a self-preservation tactic for rental companies and an attempt to avoid additional government regulations.

Conclusion: Legal Guidance from Gary Bruce

At the Law Offices of Gary Bruce we have been serving Columbus, Georgia, Phenix City, Alabama and Ft. Moore, Georgia- and the surrounding areas  -for over 30 years. We understand the complexities of rental car insurance and its implications in the event of an accident. Our firm is well-versed in local and state laws and can provide comprehensive advice to ensure you are adequately protected.

We invite you to contact us for a free consultation to discuss any concerns about rental car insurance or other legal matters. For more insights, watch Gary Bruce discuss this topic on WTVM’s Legal Break in Columbus. Click WTVM Legal Break – Should I buy car insurance when I rent a car? Do I need it? It depends. – Law Offices of Gary Bruce (garybrucelaw.com) to view the link and learn how to navigate rental car insurance decisions wisely.