Rental cars are a convenient way to get around while on vacation. They can also help you to get to and from work while your own vehicle is in for repairs. Or even to bridge the gap between when you sell one vehicle and purchase the next. But they can also be a big financial risk if you don't have the right rental car insurance.
You don’t drive your own vehicle without insurance coverage. So you shouldn’t climb behind the wheel of a rental until you understand the laws surrounding coverage. One big thing you need to know is whether or not your own personal car insurance will apply if you get into an accident.
Keep reading to learn everything you need to know about rental car insurance, and whether or not the insurance company has to cover your rental car in Utah.
Does Your Insurance Cover a Rental Car in Utah?
You’re already paying for car insurance for your personal vehicle. So you might be wondering whether you need to purchase additional rental car insurance coverage for your trip or rental period.
The answer is that it largely depends on the type and level of car insurance you currently have. The following areas of coverage are important to have when renting a car. Some will be covered by your car insurance policy, while others may not be.
Liability insurance provides protection against claims from injuries or damages caused to other drivers and passengers. Instead of paying your own bills for damages suffered, this coverage protects your bank account against covering the bills of anyone that you hurt or damage caused if you cause an accident. It also protects you against legal costs if you’re found liable for the crash.
If you have any personal car insurance at all, it’s likely that you have liability coverage. In fact, the state of Utah requires all drivers to have liability coverage. At a minimum, your Utah car insurance policy must cover at least:
- $65,000 for bodily injury per accident
- $25,000 in bodily injury per person
- $15,000 in property damage per accident
For those with proper liability insurance coverage on their personal vehicle policy, you’ll be covered when renting a car as well. While the rental car company will offer a supplemental policy, you can forgo this and rely on your own personal insurance instead.
Personal Accident Insurance
If you or someone else in the rental vehicle you’re driving is injured in a crash, personal accident insurance coverage kicks in. This coverage is designed to pay for medical bills resulting from the crash. This is another type of rental car insurance coverage you can pay for at the counter of the rental car agency. But you may have your own insurance coverage that will cover these costs instead.
A personal car insurance policy that offers personal injury protection with adequate coverage will take the place of additional rental car insurance in this instance. Additionally, your health insurance and disability income insurance may also cover these and other related costs.
Personal Effects Coverage
Not all “accidents” that can happen while you’re renting a car are actual accidents. Consider a thief breaking into your rental vehicle and stealing some of your personal effects. You likely won’t need additional rental car insurance to cover these losses. Instead, your personal effects coverage from the insurance you already have will kick in.
In most cases, your homeowners or renters insurance policy will cover thefts from a rental vehicle. If you travel with expensive items, you may want to consider purchasing an additional floater for your homeowner's policy. This includes laptops, camera gear, or jewelry. These are designed to provide additional coverage for high-price items. In some cases, you may be able to purchase a temporary waiver for additional coverage. This is a good idea if you plan to take a trip and bring along expensive items.
Collision Damage Waiver
The final type of insurance coverage you should consider when renting a car is a collision damage waiver. This is one type of coverage that you may want to consider purchasing from the rental agency.
If you have collision insurance on your personal vehicle, it will cover the cost of repairs of the rental car as well. If the vehicle is totaled, it will cover the cash value of the car. However, an additional collision damage waiver sometimes referred to as a Loss Damage Waiver, or LDW might also be necessary to offset costs
Some rental car agencies charge additional fees that are outlined in the fine print when you rent a vehicle. These fees apply if the rental is involved in an accident. They cover the agency’s administrative fees and loss of the use of the rental vehicle and are not covered by your personal car insurance policy. However, you may find that you already have coverage for these in a surprising place.
Many credit cards, and especially travel rewards credit cards, now offer collision damage waivers. Check the fine print on your card for coverage. Keep in mind that you will likely need to pay all fees associated with the rental on that card for coverage to apply.
If your credit card does not offer coverage, you have a choice to make. You can pay for the collision waiver from the insurance company. This will lower what you have to pay out of pocket following an accident. Or, you can choose to take the risk and pay these fees if you do happen to be in an accident. It’s a good idea to read the fine print and find out what you’ll be liable for first. This will allow you to make an informed decision.
Choosing the Right Rental Car Insurance Coverage
Not having the right rental car insurance can turn a fun vacation into a costly mistake. Understanding how your own car insurance in Utah applies to a rental can help you make a smart decision about additional coverage. It’s also a good idea to check with your insurance agent ahead of your trip to make sure that you’re properly understanding your current coverage.
What if you don’t currently have an auto insurance policy in your name? Or if you have only minimal coverage on your policy or have a high deductible? In that case, you may want to consider additional protection. Purchasing rental car insurance coverage from the rental agency will ensure that you aren’t hit with any massive bills or a heft deductible if you do get into an accident.
Making an informed decision about your rental car insurance starts with understanding your current coverage. Check with your insurance agent or read the fine print on your policy before your trip to make sure you’re covered in case the worst does happen.