How To Get Rental Vehicle Insurance For A Car Rental Outside Canada And The Us
If youre renting a car outside Canada and the U.S., do a little homework and find out what your insurance options are. Even if you have OPCF 27 on your auto insurance policy, it will not cover you for driving a rental vehicle in Mexico, for example. Or if you rent a car in Europe, the rental vehicle insurance endorsement on your auto policy will not apply. The same goes for the rental car insurance your credit card may provide. If you are driving a rental car outside Canada or the U.S., its a wise idea to buy the rental companys insurance.
A Few Countries Have Special Requirements
A handful of European nations have regulations about what credit cards can cover for car rentals. In Italy, for example, specific coverage against theft is required. Ireland is among the countries that prohibit third parties, such as credit card companies, from purchasing collision coverage instead, the car’s driver must purchase it themselves.
The upshot: With rentals in Italy and Ireland, ask what type of coverage might be included as part of the rental rate. Find out before you arrive in the country, so you’re not facing a confusing array of insurance options. More often than in other countries, coverage may be baked into the daily or weekly fee. If it isn’t, you’ll at least be able to determine how much extra you might pay to purchase coverage, so you’re comparing the cheapest quotes on an apples-to-apples basis.
Your Costa Rica Car Rental Insurance Questions Answered
January 14, 2020 By yeison
Renting a car in Costa Rica is one of the best ways to explore the country since you will be able to visit many places where the buses dont go. Youll also save money compared to hiring private shuttles everywhere. Having a car makes traveling around the country much more convenient!
Before you rent a car, it is very important to do the proper research to make sure it goes without a hitch. Its easy to rent a car in Costa Rica but there are some things foreigners need to know before they do and one of those things is insurance.
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Alternative #: Use Credit Card Benefits
These days, most credit cards provide free collision coverage for car rentals, provided you use the card to secure the rental. A sample credit card benefits statement describes coverage as:
Physical damage and/or theft of the covered rental vehicle. Valid loss-of-use charges assessed by the rental company while the damaged vehicle is being repaired and is not available for use, as substantiated in the companys fleet utilization log. Reasonable and customary towing charges related to a covered loss to take the vehicle to the nearest qualified repair facility.
Note that this typical Visa cards benefits do not cover diminished value or administrative costs. A few premium credit cards offer primary collision coverage, meaning the card takes full responsibility for the payment. But coverage on most cards is secondary, meaning the card picks up only what you cant first recover from your own insurance. And you still have to pay the rental company up front, then file for reimbursement from your card issuer.
Another gotcha in the above fine print: This card pays for loss of use only if verified by the rental companys log. Unfortunately, some rental companies dont cooperate with credit card issuers in providing this type of documentation in a timely manner.
Do I Need To Buy Liability Insurance When Renting A Car
I’ve seen multiple threads here on the BC forums on Tripadvisor about how in BC, it’s mandatory by law for all car rental agencies to include a minimum of $200,000 of third party liability insurance in the rental rates however I haven’t much online about it when doing a Google search. I’ve only seen a Globe and Mail article question and answer article from 2015 that briefly talked about it but it would have been more reassuring if there was a post about it from the government of British Columbia.
Just to confirm, if I’m renting a car during my trip, I shouldn’t need to pay for additional liability insurance, right? For the record, I will be using the car rentalinsurance from my credit card to cover the CDW but as we all know, most if not all credit card coverages don’t include liability insurance. Thanks in advance for your help.
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Loss Damage Waiver / Collision Damage Waiver
This waiver covers the car youre renting itself and nothing else. Having this coverage means that if anything happens to the car the costs will be paid for. This is similar to comprehensive and collision insurance in regular auto policies, but for rental vehicles.
Rental car companies have now started charging additional fees for:
- Lost revenue while the car is being repaired
- Administrative fees for handling the repair
- Towing costs
- Depreciation on the resale value of the vehicle for it having been in an accident
The expensive CDW & LDW policy offered by the rental car company covers these additional fees, but other coverage you have may not, so you may need to check.
Car rental insurance sold as Collision Damage Waiver or Loss Damage Waiver does not come cheap. At up to $30 per day, you could easily be on the hook for approximately $500 for a two-week rental, which is often more expensive than the rental fee itself. You should also be aware that it often comes with exclusions. For example, it may provide no protection while you drive on unpaved roads. Its important to note that the protection you get also varies from company to company. Auto rental companies charge a daily rate on top of the rental charge for the CDW and though you can buy this directly from the auto rental company, you should be aware that there are alternatives.
Crashes And Car Theft
At the counter: A loss-damage waiver or LDW, also called a collision damage waiver or CDW, gets you off the hook for damage to the rental vehicle or theft of the car. Its technically not insurance but rather a waiver that says the rental car company wont come after you.
Your policy: If you have collision and comprehensive coverage on your own policy, it generally will extend to a rental car as long as youre renting within the U.S. or Canada. However, you will still be responsible for your deductible, and filing a claim on your auto insurance policy could raise your premium.
If you dont have comprehensive and collision on your regular policy, or youre renting in a location where this coverage isnt in effect, youd have to pay for the damage unless you buy the LDW.
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Do You Need To Purchase Sli When Renting A Car
In the U.S., every state requires a minimum amount of liability insurance. You may already have liability coverage through your personal auto insurance if you own a car. But understand that the minimum amount of liability insurance varies by state and may not be enough. If a state requires a minimum of $25,000 in liability coverage, that is unlikely to cover all the potential expenses.
You may also have umbrella liability insurance, a low-cost policy added to your auto, homeowners or renters insurance. It can provide extra protection while driving your car or a rental. Also, be aware that U.S. auto insurance policies often dont provide any coverage abroad. You may want to or youll be required to purchase liability insurance if youre traveling overseas.
Using Your Credit Card For Rental Car Coverage
Youll automatically have this coverage if its included with your credit card no need to call or sign forms. But its usually secondary coverage, meaning your own auto insurance policy will pay out first if its available. NerdWallet assessed .
If youre planning on credit card coverage, call your credit card issuer to confirm the details.
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Mandatory Costa Rica Car Rental Insurance
When any rental car company tells you that there is a mandatory insurance, they are not lying but its not exactly specific.
As I mentioned earlier, the only mandatory insurance is the one all car owners have to pay, the yearly property tax or Marchamo. This insurance is called Responsabilidad Civil and it only covers third party damages up to 20,000,000 Costa Rican Colones .
You Need General Liability Protection
You should never get behind the wheel of a caror lawnmower, for that matterwithout liability protection. But you dont buy that from a car rental company: It usually comes with household, homeowner, or tenant insurance, and it covers far more than a car rental. And if your net worth is in six figures, you probably need an umbrella liability policy that covers a million dollars or more.
Car rental companies in most countries are required by law to include liability insurance. In the U.S., required coverage can be ludicrously small its usually much better in Europe. If you dont have substantial liability insurance, you might consider buying the rental companys offering. Still, your best bet is to make sure youre covered 24/7 with your own insurance so you can forget about the rental companys overpriced insurance.
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Auto Europe Vs Cost At Counter
We strongly recommend you also purchase more comprehensive insurance for your rental vehicle in Germany, as it negates some of the risk of having to pay upwards of 1000 EUR in cases of vehicle damage. There are two additional car rental insurances you can purchase when you book early with Auto Europe: zero deductible car rental insurance or refundable deductible car rental insurance. Zero deductible insurance reduces the CDW & TP deductible hold on your credit card to $0, where refundable deductible insurance will reimburse you a portion or entirity of the deductible in the event you damage your rental car.
All these insurance options can also be purchased locally, at the supplier rental desk, but expect to pay a significant price, especially when comparing it to the rates offered by booking in advance with Auto Europe. Some major credit cards also offer inclusive insurance coverage as well, so make sure to check with your credit card company to see what offerings they have available for you.
|Optional Insurance Coverage|
|$15-$22 USD per day||$0 USD|
Personal Accident Insurance is available at the rental counter for approximately US$5 – US$9 per day. Super CDW may be offered locally to reduce the deductible as low as zero. Optional insurance coverage is available with select suppliers only, rates subject to change without notice.
Insurance From A Car Rental Agency
Insurance from car rental agencies is often costly. You should decline it if you are sufficiently covered by your auto insurance or credit card. But if you dont have a choice, its often cheaper to choose a prepaid plan that you buy before your leave.
Depending on your other insurance, you may only need civil liability coverage or damage insurance for the rental. If thats the case, remove the coverage you dont need to make sure you dont pay twice. In Europe, for example, both insurances are usually included in the base price of car rentals.
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Paying For A Rental Car With A Credit Card
The credit card you use to pay for your rental and the benefits it provides can be a determining factor for whether or not you purchase a number of these insurance products. So, it’s worthwhile to make a thoughtful decision about how you’ll pay for your rental.
In addition to the various card benefits, you should consider the amount of credit available on each card. The reason: In the event there are damages, a rental car company is likely to charge your card immediately and let the coverage sort itself out later. Choosing a card with less available credit will limit what the rental car agency can charge on it.
Finally, be aware that most credit cards will require you to decline any rental car insurance coverage in order to receive benefits. Consider calling your credit card company to learn more about your coverage and credit limits before traveling, too.
Rental Car Insurance Faq
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Personal Effects Insurance Coverage For Rental Cars
Personal effects coverage helps pay for the costs of replacing or repairing belongings in your rental car that were stolen or damaged. If you have homeowners or renters insurance, it most likely will cover your stuff if its stolen or damaged in your rental car, subject to your deductible.
A smart preventative measure is to remove your things from your rental car when youre not in it. If you have very valuable items like jewelry, talk to your insurance agent to increase the limits your personal policy will pay if these items are lost or stolen.
Quick takeaway: Do you need rental car personal effects coverage? Probably not, depending on your existing homeowners and rental coverage.
But if you have high deductibles on personal effects losses, weigh the rental car cost for this coverage versus your potential loss.
Understanding Rental Car Insurance Options
If you decide to purchase supplemental insurance from the car rental company, you should understand your options. When you rent a car, it will come with the minimum required amount of liability coverage, but that may not be enough to cover you in case of an accident, and it wonât cover any damage to the rental car itself. Most major car rental agencies offer several different types of insurance add-ons.
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Reduced Coverage For A College Student
Let’s say your child is away at college for much of the year and leaves their car at your home. In this instance, you might consider decreasing the coverage to the minimum amount requiredwhich could lower your premium.
Another possibility: Many auto insurers let you temporarily exclude a child from your policy who has left for college, as long as the school they’re attending is more than 100 miles away from home. When the school is less than 100 miles away, auto insurers figure there’s a good chance that your child may return home fairly and use your car, thereby eliminating the opportunity to get an exclusion. You’ll just have to remember to stop and restart their policy as necessary.
You Are Going On A Business Trip
If you are going on a business trip in your personal vehicle, your car insurance policy might have some limitations. For instance, if you got into an accident while driving to a conference or a big meeting, it might not be covered.
Laura Adams says, Another consideration is whether you are renting a car for work or your own business travel. If so, your existing personal auto insurance may not cover you. When in doubt, it is best to purchase rental car insurance. You will be glad you did, as even minor damage could be expensive to repair.
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Rental Car Insurance And Other Protection Products
Enterprise does offer additional protection products that you can purchase along with your rental vehicle. Currently, we offer our customers Damage Waiver, Personal Accident Insurance, Personal Effects Coverage. Please scroll down to view a protection product and find out more about what it covers.
Will Your Personal Auto Insurance Policy Transfer To The Rental
Some might not even be aware that their private passenger auto policy will extend to cover them while they are driving a rental in the United States.
You need to be sure to check with your personal auto insurance provider to learn exactly how your coverage extends, but its nice to know that the liability coverage from your personal insurance policy will follow you as the driver.
Here is a brief explanation of how your personal coverage can protect you:
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What Does Broadest Level Of Coverage Mean
You should find out how much coverage you have before you assume that you have enough coverage to comfortably rent a car.
Under you auto contract, the insurer will pay up to the highest limits that you have on your policy. If one of your vehicles has full coverage insurance, the rental will as well.
If You’re Renting A Car Check Your Own Coverages First
Before you enter an agreement with any type of rental service, maximize use of the insurance you’re already paying for and avoid paying for duplicate insurance.
If you own or lease a car and/or have homeowners insurance, call your insurer to first check the following:
- How much coverage you currently have on your own car In most cases, whatever auto insurance and deductibles you have on your own car would apply when you rent a car .
- If you still have collision or comprehensive If you dropped these coverages on your own car as a way to save money on your car insurance, you may not be covered if your rental car is stolen or damaged. Insurance rules vary by state, so it is best to check with your insurance professional for the specifics of your policy.
- If you are covered for administrative fees, loss of use or towing charges Check to see whether your insurance company pays foror provides a rider foradditional fees.
- Whether your homeowners or renters insurance covers the loss of possessions These policies generally cover your belongings if they are damaged or stolen out of your vehicle.
The credit card you use to rent a car may also provide some insurance. Though coverage is likely to be limitedfor example, it may only cover the deductible if you make a claimit’s worth knowing what protections it will provide.
- That is, they will kick in after your personal insurance policy or the insurance coverage offered by the rental car company are utilized.
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