Your Guide To Purchasing Rental Car Insurance

Are you planning a road trip? Then you may have to rent a car to make your travel comfortable. One of the biggest decisions you may have to make before hiring a car is whether or not to obtain a  rental car insurance, the answer to this dilemma is simple; “if your existing insurance policy covers rental cars, you can decide not to buy rental car insurance, however, if your existing insurance doesn’t cover rental cars, it becomes essential that you get a rental car insurance”.

Purchasing rental car insurance has steps you need to take and processes you need to follow, if you rush into buying a rental car insurance policy, you may end up purchasing an unneeded insurance. Hence, before you buy a rental car insurance you need to ask yourself the following questions:

  • Do I need an extra insurance?
  • Do I need to pre-pay for gas or fill that up myself?
  • How long am I going to rent the car?

The moment you can answer these questions freely, you sure stepped closer to making the right decision.

Steps for Purchasing Rental Car Insurance

If you have ever been in trouble with an insurance company for simple discrepancies in your insurance policy or just need to be prepared for the next time you are going to rent a car, This guide may be quite useful for you.

Determining whether you Need Excess Rental Car Insurance

This is the first and most important step, if you skip this step, you will easily be persuaded at the counter to buy a policy you don’t need. To determine whether or not you need excess insurance, you have to find out what your existing policy covers.

With personal car insurance and a credit card, there is a chance that you already are fully covered and don’t need excess rental car insurance, however, if you have a credit card without a personal car insurance, you are not covered on some incidence, hence you need to buy additional coverage for full protection.

Understanding Insurance Policies of Your Host Country

If you are going on a vacation and you intend to hire a car in your host country, you need to be sure that your existing insurance policy will cover the rented car.

Relying on your existing insurance policy is risky especially if you are hiring a car abroad, because most times when we hire a vehicle in a different country, our domestic insurance may not be valid.

A simple solution is purchasing an annual worldwide car hire excess insurance. If you buy an annual worldwide car hire excess insurance policy, you get Collision Damage Waiver in most parts of the world; you’ll also get Supplemental Liability Insurance.

Determining What the Type of Rental Car Insurance You Need

Once you are sure you need extra car rental insurance, you need to come to terms with the policy that best suits your needs. There are a lot of options to choose from like Collision Damage Waiver (CDW), Loss Damage Waiver (LDW), Supplementary Liability Insurance (SLI), Personal Effect Coverage, Personal Accident Insurance and annual worldwide car hire excess insurance, each of these policies cover different incidents and most times they overlap.

When we buy excess insurance, we tend to go for the same coverage we would have if it is our private car, however, when choosing an option, it’s better we buy primary insurance because our credit card can serve as a secondary insurance. This is a decision you have to make by yourself, so you need to first find out what your existing policy covers, by reading the terms and conditions or talking to a customer service personnel.

Determine where to Buy the Rental Car Insurance Coverage

If you have made a decision on the type of insurance policy you need, you have two options to choose from, you can either buy from the rental car company or from a third party company. Car rental companies sell Collision Damage Waiver (CDW), and Loss Damage Waiver (LDW), while third-party companies offer different coverage and are known as ‘excess protection insurance’. Buying excess insurance from a third party company is cheaper, on the downside, if the hired vehicle gets damaged, you’ll have to first pay the rental company, and wait to be reimbursed by the third party company.


The decisions you make before you hire a car will go a long way to determine how much fun you’ll enjoy during your road trip. Renting a car without adequately ensuring it is going to be a bad decision, at the same time, be careful not to get ripped off by the insurer. If you are looking for tips to make your car travel comfortable then don’t forget to check our other travel guides to get all the information.

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