So my good buddy, Chris, along with his lady pal moved down south last year. Long story short they have decided to move back to good old Boston Massachusetts. I guess they got tired of the warm weather and missed the snow. I got a call from Chris this morning (I promise this story is true) and he said “hey Duff, the wife and I are renting a U-Haul to move all of our stuff home, should I purchase the auto insurance on the rental?

We get this question a lot. Although, the conversation usually goes like this; INSURED: “Hi this is Billy Button and I’m a Duffy Insurance customer and I’m in Vegas for my good pal’s bachelor party right now. I’m trying to get a rental car and they are asking me if I want to purchase the insurance on it. Should I buy it? To cover their behinds most insurance agents always recommend purchasing the coverage. That’s the lazy answer! But, below is some stuff your typical insurance agent may not tell you. (If you travel outside the U.S. the following does not apply. If you are traveling anywhere for business, then the following does not apply).

As an auto insurance buyer here’s some of what you need to know about getting insurance on a rental car.

We are going to assume that you rent a car in the U.S. that is similar in style and value to what you own, then your own auto insurance should cover the rental car. Always call your insurance agent to double check. If you have collision coverage on your personal auto insurance then it should cover you for the rental car. But, if you do not have collision coverage on your policy, then obviously you do not have collision coverage on the rental. This is the same with all the individual coverage on your auto insurance.

The tricky stuff:

1. Should you not choose to purchase the insurance from the rental company and rely on your own insurance, the vehicle that you have at home is not supposed to be driven by anybody.
2. Should you rent a vehicle that is nothing like your own, (My Buddy Chris in the above example) then your personal auto insurance will not cover you in most cases. So, buy the insurance if you want coverage!
3. If you are not listed as a named insured on your policy at home, then coverage will not follow you from that insurance policy. So buy the coverage at the rental counter! (Please note a named insured is different from being listed as a licensed operator).
4. An issue when declining to purchase the coverage from the rental car company is that typically your primary auto insurance company will not cover the loss of use. This usually gets charged to your credit card by the rental company and can be a nightmare. Loss of use is the money that the rental car company would have made by renting during the time that the car was being fixed. We have heard a few cases in which the rental company charged the renter’s credit card on file for loss of use.
5. Credit Card companies are typically an X factor when renting cars. Some credit card companies will offer certain types of insurance coverage for rental cars complimentary. We strongly recommend contacting them as certain ones will pay for the loss of use talked about in the last point.

So my advice to my good pal Chris and his lady friend was to buy the insurance on the U-Haul. Obviously, since there are many factors involved, it really depends on the situation when determining whether or not to buy the coverage from the rental company. I know when I go away I always purchase the insurance. We have seen too many cases where people get burned for not doing so. When in doubt call your insurance agent, credit card company, and insurance company.

Provided By @DuffyInsurance