It’s hard to believe but summer’s only 5 weeks away and that means summer vacations are almost upon us. One of the questions I’m asked a couple of times a year by a client is whether or not their car insurance covers a rental car. It’s usually asked by someone who’s getting ready to go on a trip and rent a car in their destination. In most cases the answer to their question is yes, however there are a few things to think before you get there.
Most car insurance companies will extend coverage to protect you and the rental car, should you have an accident, anywhere in the U.S. In most cases, this coverage will also extend to American provinces such as Puerto Rico, the U.S. Virgin Islands, etc., as well as to Canada.
When it comes to Mexico, some companies will only cover your car up to 3 or 5 miles across the U.S. / Mexico border and exclude coverage to a rental car. I recommend anyone traveling to Mexico, whether in their car or renting a car there, to get the Mexican car insurance for the duration of your trip which can alleviate any surprises.
There are a few car insurance companies that will extend coverage to rental cars in many European countries and a few Asian countries too, however, most do not. I recommend anyone traveling to an international destination to confirm that their policy covers them there with a review of their policy or a discussion with their agent.
In addition to knowing whether or not your company will cover you and the rental car you’re driving, there are a couple of thoughts I suggest everyone consider.
- Carry a photocopy of your car insurance ID with you. This can be invaluable if you’re involved in an accident where ever your travels take you.
- I also suggest carrying a photocopy of your policy declaration pages with you too. These are the pages that show the level of insurance coverage you have and can help you determine if the car you’re renting will be adequately covered if it’s an accident. If the rental car is worth more than the level of property damage you carry, then opt for the property damage coverage from the car rental company and let your policy’s liability coverage protect you.
- If you do use your car insurance policy to cover you in a rental car, just know that if you’re in an accident, it will show up on your policy as a claim. If you don’t want that to happen, then pay for the rental car insurance from the car rental company.
- Take pictures of all 4 sides of your rental car when you pick it up and then after you return it. This can protect you if you’re blamed for damage to the car after you’ve returned it.
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