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Can I rent a car without insurance?

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Here's what you need to know...
  • If you have car insurance, your insurance will cover a rental car in the U.S.
  • If you do not have insurance coverage or believe you will need additional coverage, check with the agent at the car rental company to discuss options
  • Liability-only policies often will not be enough to safely cover your rental
It is not out of the ordinary for a consumer who is at the counter of a car rental agency to jump at the opportunity to buy supplemental coverage when it is offered.

If you were to read the confessions of any honest, experienced car rental agent, you would learn that supplemental insurance rates are negotiable and that car insurance is not a legal requirement when you are driving a car you do not own.

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Just because you can legally get behind the wheel of a rental car without insurance does not mean it is the best choice.

If you do not own your own vehicle, and you are tempted not to take on the costs of buying specialized insurance, read this guide to insuring rental cars for all of the pertinent information that you need to know.

Why Renters Are Not Legally Bound to Buying Insurance

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You are required by law in most states to insure all vehicles that you legally own.

Since the registered owner of a rental car is the agency and not you as the renter, you cannot be pulled over and cited for driving without coverage when you are operating a rental.

While you cannot be cited, you can still face a civil lawsuit for causing third-party damages or injuries when you do not have any liability insurance to pay for property damage or bodily injury expenses.

If you are negligent for the injuries, third-party damages or the damage to the rental, you may be ordered to pay by liquidating your assets or by having your wages garnished.

As you can see, while driving without car insurance is an option, it is not a wise choice to make when you understand what all of the consequences can be.

Understanding How Your Car Insurance Covers Rentals

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Some might not even be aware that their private passenger auto insurance will extend to cover them while they are driving a rental in the United States.

You need to be sure to check with your carrier to learn exactly how your coverage extends, but it’s nice to know that your liability insurance will follow you as the driver.

Here is a brief explanation of how your personal coverage can protect you:

– Liability Insurance

When you own a car and live in a state where car insurance is a requirement, you will have at least a minimum amount of liability coverage. Liability coverage will pay third-party expenses for:

  • medical treatments
  • emergency transport
  • loss of wages
  • repairs or replacements when you are negligent for a collision

When you review your insurance policy, you will see that the liability coverage will follow you to provide protection if you are borrowing a car or renting a replacement.

You should always check with your agent to see if you need to notify the insurer before you rent.

There are also other considerations to make. Be sure to check your limits and consider raising them. When you are driving on unfamiliar terrain, the risk of having a loss is higher.

On many occasions, however, insurers will raise your limits automatically to match state requirements if yours are too low.

– Physical Damage

Physical damage coverage will help to pay for repairs and car replacement of the covered vehicle when you experience a covered loss. It is made up of comprehensive and collision coverage.

Collision losses involve crashing with an object. Comprehensive coverage will pay for losses that do not involve a collision.

Some examples include:

  • fire
  • theft
  • vandalism
  • explosion
  • glass breakage

Not all auto insurance policies have physical damage coverage.

You should review your policy closely to see if you have both comprehensive and collision cover.

If you do, you will be happy to hear that your coverage for physical damage will transfer to the rental car. It is defined under the policy as a replacement vehicle.

Whatever deductible that you carry on your policy will apply when filing a claim for your rental.

If you do not have auto insurance or you do not have full coverage on any vehicle, damage to your rental will not be covered unless you buy a supplemental plan.

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Your Options for Supplemental Coverage

All consumers who have rented a car know that rental agents are going to push car insurance. Now that you know how your insurance works, you can decide if you need to purchase their coverage.

There are several types of insurance peddled at the counter. Knowing how one differs from the other is crucial to cross the duplicates off the list and select the ones that will give you peace of mind.

Here is a breakdown of each:

– Collision Damage Waiver (CDW)

The CDW is a damage waiver that will pay for all of the repairs to a rental car when it is damaged or stolen. The loss must happen when an authorized driver is operating the car and during the period when the waiver is valid.

– Personal Accident Insurance

This coverage pays for emergency medical transport and medical benefits if the renter or their passengers are injured in an accident.

– Supplemental Liability Protection

Car insurers are required to provide a limited amount of liability cover, but you can buy a supplemental amount of liability protection that covers you if you are sued. Anything that is carried by the rental agency is there to protect them and not necessarily you.

– Personal Effects Coverage

You most likely will travel with valuable items. If you lose something of value, Personal Effects Coverage will pay to replace up to $500 of your valuables per person. Make sure you know how your property insurance works first.

You can rent a car without insurance, but buying supplemental insurance is best.

If you currently want to price the cost of personal insurance, use an online rate comparison tool and see how much cover will cost for your cars.

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