Rental car liability insurance is coverage that pays for injuries or property damage that you cause in an accident when you are driving a rental car. Rental car liability insurance does not protect you or your rental car from collision damage, car theft, loss of personal effects, or injuries.
In most states, some rental car liability insurance is included with the rental. However, the state-mandated minimum insurance that these cars carry might not be enough to protect you from the financial repercussions of an accident. Because of this minimal coverage, rental companies sell supplemental liability insurance at the counter. Rental car companies also offer other types of coverage like loss damage waivers, roadside assistance, and personal accident insurance.
You might already have rental car insurance through your current insurance coverage or your credit card, however. Your current auto insurance policy likely extends its liability coverage to rental cars, whereas credit cards often provide the equivalent of comprehensive or collision coverage but no liability coverage.
When Your Standard Insurance Covers Rental Cars
- You have personal auto insurance
- Your personal liability coverage limits are equal to or higher than the limits required for the vehicle that you're renting
- You're only using the rental car for personal reasons, not business-related
- You're only traveling inside the United States
- You have homeowners or renter's insurance
When Your Credit Card Covers Rental Cars
Some credit cards, including many travel rewards cards, provide rental car insurance if you use the card to pay. Certain cards provide primary coverage, which means you don’t have to file a claim with your insurance company before you file with the card company. Other cards offer secondary coverage, meaning they pay only after your insurance company has reached its limits.
However, bear in mind that many cards only cover damage to the rental car, not damage to other people’s property, your property, or anyone’s injuries. So be sure to check with your credit card company to see if – and what type of – rental car insurance is included.
If You Don’t Have Rental Car Liability Insurance Through Another Source
If you do not have a personal car insurance policy and your credit card doesn’t cover you, you can purchase supplemental liability insurance from the rental car company. However, this can quickly get expensive, especially since liability insurance for the rental car is sold separately from other coverage.
If you rent cars frequently, it might be more efficient to buy rental car liability insurance from another source. For instance, travel insurance companies offer rental car liability insurance, often at lower prices. You can also buy a non-owner car insurance policy, which offers liability coverage. Another option is to compare credit cards that covers rental cars