Insurance Options on Rental Cars

There are a number of car rental insurance options that you should know about before you buy insurance for your trip. They an often be confusing, and you should check to be sure that your car rental agency covers one or all of these options. Remember to choose carefully before you get your insurance and make certain that you read the fine print of your car rental agency’s agreement and insurance policy’s.

Collision Damage Waiver (Loss Damage Waiver)

The LDW (Loss Damage Waiver) or The CDW (Collision Damage Waiver) says that the individual who rented the car is responsible for the first few hundred dollars of damage in case the car is in an accident. If you buy the CDW, you are released from all loss or damage. However, there is a catch. If you violate the rental agreement, this voids the waiver. Check and see if your individual insurance agency offers coverage, and what their limitations or restrictions entail. Collision Damage Waiver is usually optional, but there are a few companies that require you to buy the policy. Once again, be sure to check.

The cost for the Collision Damage Waiver ranges from eight ($8) to twelve dollars ($12) per day. Check your own policy and figure out whether or not you need the coverage before you get to the rental agency. Tip: since the CDW may increase your insurance (if you decide to get it through the agency, you might be better off renting a larger car, as there is often a special promotional rate that includes the CDW in the price. Also, the Collision Damage Waiver is offered by some credit card companies, so be sure to check yours.

Personal Accident Insurance (PAI)

Before you consider personal Accident Insurance, check with your own insurance agency and see what their policy’s are with regards Personal Accident Insurance. If your car insurance agency covers rental cars, you won’t need Personal Accident Insurance. PAI provides medical coverage and accidental death coverage. It will also cover any other passengers riding with you.

Personal Effects Coverage (PEC)

Personal Effects Coverage provides both theft and loss insurance if any of your personal effects are taken from the rental car. Check with your auto insurance policy again to determine if this same service is offered by your insurance company.

Additional Liability Insurance (ALI)

Additional Liability Insurance is yet another option offered by car rental agencies. It protects you and anyone else insured against claims made by third parties regarding death, injury, or property damage.

Remember that before you look into any of your car rental agency’s insurance policy options, you read the fine print carefully and determine if you really need it or not. Always make sure to do the research before you get to the rental agency to ensure that you are informed and that everything goes as smoothly as possible.

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