When you rent a car, a customer service rep may try to sell you rental car insurance. This coverage could protect you from having to pay if the rental is stolen or damaged. But in some circumstances, you may not need to purchase additional rental car coverage. For example, if you already have full coverage car insurance, your policy will typically extend to the rental car with the same coverage you have on your personal vehicle. Before your next vacation or work trip, take a look at this rental car insurance guide to get the coverage you need without unnecessary expenses.

When do you need rental car insurance?

You may not need additional rental car insurance if you have a personal auto policy with full coverage and are renting a private passenger vehicle. However, your exact rental coverage needs depend on the type of insurance you carry on your personal vehicle, as well as the terms of your rental contract and the reason you’re renting a vehicle.

In some scenarios, your personal car insurance policy may have gaps in coverage that could leave you uninsured or underinsured if you’re in an accident in your rental car. For this reason, most insurance professionals advise discussing your coverage options with your insurance agent before you head to the rental counter.

The scenarios below outline situations in which you may need to purchase rental car insurance before renting a vehicle.

You do not have any type of insurance

If you don’t have a car insurance policy of your own, you’ll likely need to purchase rental car insurance when renting a vehicle. There are a couple of reasons for this. First, most states have strict laws requiring all drivers to carry a minimum amount of auto insurance while driving any vehicle.

Additionally, the costs of an at-fault accident or other vehicle damage can add up quickly. Without an insurance policy, you would be responsible for paying any of those costs out of pocket. Consider purchasing both liability coverage and a damage waiver from the car rental company before getting behind the wheel of a rental vehicle.

In some cases, your credit card company might provide rental car coverage — and some drivers who have no personal auto policy may rely solely on this insurance option when renting a car. While rental car coverage through a credit card can be a helpful supplement to a primary insurance policy, it may not offer adequate financial protection on its own. If you have rental car coverage through your credit card but no primary auto policy, you may want to call the card issuer for additional information before declining coverage through the rental company.

You do not have collision or comprehensive coverage

Collision and comprehensive coverage are part of what’s known as full coverage car insurance, which covers damage to your vehicle after a collision or other incident, such as hail, theft or fire. These types of coverage typically extend to a rental vehicle. However, if you only have liability insurance coverage, your personal car insurance won’t cover damage to the rental.

To financially protect yourself in this situation, you can purchase a loss damage waiver (LDW) from a rental agency. This agreement waves your financial responsibility for damage or loss of the rental car, including loss from theft.

You do not want to pay a deductible

If you rely on your personal car insurance to protect your rental car, and you get into an accident, you typically have to pay a deductible. However, if you buy rental car insurance and you get into a collision, there is no deductible required.

How does car rental insurance work?

Rental car insurance works the same way as regular auto insurance: you pay a certain amount of money in exchange for an insurance company’s agreement to cover losses and claims up to an agreed amount. However, rental car insurance comes in different forms than a standard auto insurance policy.

The most common types of rental car insurance include:

• Collision damage waiver (CDW): For a daily fee on top of your rental fee, a collision damage waiver waives fees associated with damage to the rental car from an accident, fire, vandalism, severe weather and other perils specified in your agreement.

• Loss damage waiver (LDW): Loss damage waivers and collision damage waivers are often used interchangeably, but some rental companies use this term to specify a damage waiver that covers theft of the rental car on top of other physical damage perils. Be sure to read the details of any waiver offer carefully to understand what is covered.

• Supplemental liability protection: If you don’t have your own liability insurance, this covers bodily injuries or damage you cause to other vehicles or property.

• Personal accident protection: This type of coverage covers medical costs for yourself and your passengers if you’re involved in an accident in your rental car. If you already have personal injury protection or medical payments coverage on an existing auto policy, you may already be covered.

• Personal effects coverage: This optional coverage pays for loss (by theft or damage) to personal belongings in your rental car. If you have a home or renter’s insurance policy, you may already have similar coverage.

Keep in mind that rental car insurance is not the same thing as rental car reimbursement insurance. Rental car reimbursement coverage is a coverage type on standard auto policies that pays for the cost of a rental car (up to your policy limits) while your vehicle is inoperable due to a covered claim.

How much is rental car insurance?

The cost of rental car insurance depends on a few factors. First, it depends on the company you buy coverage from. It also depends on the state, what type of car you are renting and how many miles you are driving. Purchasing optional add-ons such as personal effects coverage will also increase the amount you pay for rental car insurance on top of your rental car fees.

Does my credit card offer rental car insurance?

Many credit card companies offer rental car insurance as one of the benefits for cardholders. However, rental car insurance provided by your credit card company is usually secondary insurance. That means if you get into an accident or the car gets stolen, your auto insurance company will get billed first. If that is the case, your deductible will apply to the claim.

There are some credit card companies that offer primary rental car insurance, although it is less common. Primary insurance does not go through your personal auto insurance, so you do not have to pay a deductible. You can call your credit card company to determine if your card offers rental car insurance and what type of insurance they offer.

Most major credit card companies, like Visa, MasterCard and American Express all offer some form of rental car insurance for their cardholders. To take advantage of the coverage, you usually have to pay for the rental car using the card and rent the car in your name.

Which insurance providers offer rental car insurance?

Most major car insurance providers automatically provide rental car insurance coverage at no additional cost beyond what you are already paying for your monthly premium. However, it is important to remember that the coverage you carry on your policy is what will also apply to your rental. If you have liability only on your personal auto policy, you may want to consider bridging the gap with an LDW.

Some companies offer standalone rental car coverage policies. The rates for these policies can be cheaper than a standard auto policy, but the coverage provided is not as robust.

• Allianz Global: Allianz Global’s Rental Car Damage Protector includes $50,000 in coverage for just $11 per day, and offers coverage anywhere in the world. Every policy comes with up to $1,000 in coverage for lost baggage and personal items, 24-hour emergency assistance and $1,000 in trip interruption coverage.

• Bonzah: With a Bonzah rental car insurance policy, you can get up to $35,000 in coverage with a maximum deductible of $500, plus up to $500 in coverage for lost luggage and personal items, no deductible and a 10-day free look period. Bonzah also offers up to $1 million in supplemental liability coverage.

• RentalCover.com: Rental car insurance from RentalCover.com is meant to supplement insurance from your credit card provider. The company claims that drivers can get supplemental insurance for up to 50 percent less than an LDW waiver from the rental counter. One of the biggest draws is that drivers can cancel their rental insurance for a full refund up until their car pick-up time.

• Sure: Sure is a mobile-based rental car insurance company that is entirely digital. When you download the app, you can select your trip dates, the type of coverage you want, the deductible and more. That means you can update and make changes to your choices on-the-go. Every policy comes with great perks, like flat tire protection, lost key reimbursement and towing coverage.

Frequently asked questions

• • Since coverage options and premiums vary by insurer, there’s no single insurance company that’s right for everyone. To find the best car insurance company for you, select a few insurance companies that interest you and request quotes from each to compare. While shopping, consider various factors, such as rates, coverage options and customer service ratings.

  • When you rent a car, rental agencies typically don’t include roadside assistance, though some companies like Hertz may include a basic roadside plan. If you already have roadside assistance, then it may extend to your rental. In addition, some rental companies may allow you to purchase a separate roadside assistance — which is different from rental insurance.

  • Getting into any accident will most likely affect your insurance premium, whether it is in your car or a rental car. This is especially true if you have rental car insurance through your auto insurance provider or a credit card company. Anytime you file a claim that is attached to your auto insurance policy, the company will know you had an accident and will likely increase your rate accordingly.

  • Your personal auto policy typically extends to a rental car with the same coverage you have on your primary vehicle. If you’re not certain your policy will cover a rental car, consider checking your insurance agreement or reaching out to your insurance agent or insurance company to ask about your policy details.