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The Truth About Car Rental Protection: From Rental Agency Coverage to Your Auto Insurance Policy

When renting a car, one of the most common questions that come to mind is whether to buy the car rental protection offered by the rental agency or rely on your auto insurance policy. At Renee Jackson Insurance Agency, we understand that this decision can be confusing, and our goal is to provide you with the clarity you need. Let’s dive into the truth about car rental protection and what your auto insurance policy covers.

Understanding Car Rental Protection from Rental Agencies

Car rental agencies typically offer several types of protection plans, which can add significant costs to your rental. Here are the common types of coverage they provide:

Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW):

  • This waiver isn’t technically insurance but rather a waiver that relieves you of financial responsibility if the rental car is damaged or stolen.

  • It often covers “loss of use” charges, which are fees the rental company might charge while the car is being repaired and thus unavailable for rental.

Liability Insurance:

  • This insurance covers you if you damage someone else’s property or injure someone while driving the rental car. Rental companies are required by law to provide the state minimum liability coverage, but it’s usually very low.

Personal Accident Insurance:

  • This covers medical expenses for you and your passengers in the event of an accident.

Personal Effects Coverage:

  • This insurance protects your personal belongings if they are stolen from the rental car.

While these coverages can provide peace of mind, they can also significantly increase the total cost of your rental.

What Your Auto Insurance Policy Covers

Before purchasing any additional protection from a rental agency, it’s essential to understand what your existing auto insurance policy covers. Here are the primary coverages to review:

Collision and Comprehensive Coverage:

  • If you have collision and comprehensive coverage on your personal auto insurance, it usually extends to rental cars. This means your insurer would cover the cost of repairs or the value of the car if it’s damaged or stolen, minus your deductible.

Liability Coverage:

  • Your personal auto insurance’s liability coverage typically extends to rental cars. This coverage would pay for damages or injuries you cause to others in an accident.

Medical Payments or Personal Injury Protection (PIP):

  • If you have medical payments coverage or PIP, it can cover medical expenses for you and your passengers in a rental car accident.

Uninsured/Underinsured Motorist Coverage:

  • This coverage protects you if you’re in an accident with an uninsured or underinsured driver while driving a rental car.

Credit Card Rental Car Coverage

Another layer of protection might be available through your credit card. Many credit card companies offer rental car insurance as a cardholder benefit. This coverage is typically secondary, meaning it kicks in after your auto insurance, but in some cases, it can be primary. It’s crucial to understand the specifics of your credit card’s rental car coverage, including any exclusions and limitations.

Comparing Costs and Benefits

When deciding between rental agency protection and your auto insurance, consider the following:


  • Rental agency coverage can add $10 to $30 per day to your rental costs. In contrast, using your auto insurance involves paying your regular premium and potentially a deductible if you make a claim.

Coverage Limits:

  • Rental agency coverage might have fewer exclusions and lower deductibles compared to your auto insurance. However, your auto insurance often provides higher liability limits, which can be crucial in severe accidents.


  • With rental agency coverage, the claims process can be more straightforward and faster since you don’t have to involve your auto insurance company. This can be particularly beneficial if you’re traveling.

Making the Right Choice

Here at Renee Jackson Insurance Agency, we recommend taking the following steps to make an informed decision:

Review Your Auto Insurance Policy:

  • Contact your insurance agent to understand what coverages extend to rental cars. Ensure you have adequate liability, collision, and comprehensive coverage. If your coverage is through our agency, we can help you understand coverage and options.

Check Your Credit Card Benefits:

  • Review the rental car insurance benefits provided by your credit card. Ensure you know the terms and conditions, including whether the coverage is primary or secondary.

Evaluate Your Risk Tolerance:

  • Consider your comfort level with potential out-of-pocket costs. If the peace of mind from rental agency coverage is worth the extra expense, it might be a good choice for you.

Consider the Rental Location:

  • If you’re renting a car abroad, your auto insurance might not cover you, making rental agency protection more necessary.

Deciding whether to buy car rental protection from the rental agency or rely on your auto insurance policy involves evaluating your current coverage, understanding the rental agency’s offerings, and considering your personal risk tolerance. At Renee Jackson Insurance Agency, we’re here to help you navigate this decision with confidence. Contact us today to review your auto insurance policy and ensure you’re adequately protected for your next car rental experience.

Remember, being well-informed is the first step toward making the best choice for your financial and personal safety. Happy travels!