Rental Car Insurance

Car rental insurance becomes necessary when an individual takes any car on rent. Generally, the car rental business arranges for Rental car insurance. Such insurance on rental car taken through car rental businesses is usually collision damage waiver. This covers many costs including vehicle repair or replacement costs. Any automobile accident may result in bodily injuries, death, and loss of valuable things that were in the vehicle at the time of accident. Bodily injury or death may relate to the person insured or other passengers in the vehicle at that point of time. Alternately, they may form part of the third party claims, the third party being those in the other vehicle or vehicles in the same accident. The valuables that may be damaged or lost during such accidents by either party may also be covered through an automobile insurance. Since the accident results in damage to the vehicles of the insured as well as the other parties involved in the accident, automobile insurances offer cover for any costs that may be incurred towards repairs and / or replacement, subject to the terms and conditions mentioned in the automobile insurance policy.

Apart from these, an automobile insurance may also cover the risks of the vehicle being stolen, or damaged during any riots, fires, floods, etc. Of course, the person purchasing the insurance cover has to decide which risks he wants cover for, and which risks are improbable. There are, however, some risks that have to be covered because of legal stipulations. Such mandatory requirements, however, differ from state to state. This is the reason, premiums applicable on automobile insurance also vary from state to state.

Since car rental insurance is a type of automobile insurance, the risks covered under it are of the same class. Again, it is not essential that the individual purchasing any rental car insurance should buy cover for all types of risks. An individual may even buy an automobile insurance that covers rental cars. However, any such insurance usually does not cover the risks related to the vehicle, because individual may opt to take a costlier vehicle on rent, unlike the one he owns. This may translate into higher damages and claims for the insurance company. Therefore, any cover for rental cars in the regular automobile insurance may be inadequate. In addition, it may also be time consuming to claim under such policy because the insurance company would take time to inspect and confirm. But the insured would have already paid the amounts to the car rental business in the meantime. If the debit is through credit cards, then the interest burden can be substantial. The major difference between car rental insurance and the regular automobile insurance is the period for which the cover is taken. Automobile insurance is mandatory and therefore it is renewed periodically. Rental car insurance on the other hand is required only for a short period. Charges for such insurance are high.

Car rental insurance charges can be brought down by ensuring flawless driving record, driving at reasonable speed, selecting a car that is not very expensive, avoiding driving after consuming some liquor, etc.