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When you Rent A Car
While Iíve been convalescing Iíve had a chance to watch a lot of movies. I am a fan of Meet the Parents and the sequel, Meet the Fockers. One of my favorite scenes (probably because of its insurance undertones) in Meet the Fockers is when Greg (played by the hilariously funny Ben Stiller) rejects the insurance coverage offered by the rental car agency. (whenever I see that scene I always applaud Greg because it is exactly what I would do).
Recently, on a trip to Omaha, NE (right when the weather turned horribly frigid and icy) we needed a rental car. The set-up at the Omaha, NE airport is to complete the payment transaction at the desk inside the terminal, walk outside, and follow the signs to the Enterprise kiosk. Just before we reached the kiosk Grant (Enterprise employee) greeted us. He noticed I wasnít wearing gloves so he asked if I needed his extra pair. I said no despite the below zero temperatures. Grant walked us to the compact car we had reserved. Grant pointed out that my mom and I might want to upgrade vehicles so as not to swerve and fishtail all over the road given the current conditions. He was so compelling, that I, for the first time ever, agreed to upgrade vehicles. Then Grant asked, almost without my realizing it, if I wanted their full insurance coverage or partial insurance coverage. I only hemmed and hawed for a minute or so. Grant reeled me in when he said every other driver may not drive as well as I on the ice/snow (Grant was good). I digressed (a lot). Kudos to Grant and the entire Omaha, NE airport Enterprise employees.
When you need to rent a car, drivers should educate themselves long before they reach the rental car counter. Drivers should carefully review their auto insurance policy and check with their credit card issuer about auto insurance benefits. Car rental companies offer several different options that your auto policy may already cover. Car rental agencies typically offer the following:
Loss Damage Waiver (LDW) also referred to as a Collision Damage Waiver. If you have comprehensive and collision coverage on your vehicle, it is likely that you will not need this additional protection. Comprehensive (sometimes referred to as Other than Collision (OTC) insurance covers damage to the vehicle as a result of fire, theft, wind, striking an animal (like a deer), vandalism, and falling objects. Collision insurance covers the cost of repairs or actual cash value (in the event of a total loss) to the vehicle. Car rental agencies may charge an additional $10-$20 a day for this protection.
Liability insurance covers medical expenses and damages to another personís personal property (i.e. their vehicle as a result of an accident that you caused). If you have an adequate amount of liability coverage on your personal auto policy, you may consider forgoing this additional liability protection. (Hint: If you have minimum liability limits you may consider the supplemental coverage). The rental agency may charge an additional $7-$14 a day.
Personal Accident Insurance provides coverage to the renter and passengers for medical bills from a vehicular accident. If you have adequate health insurance along with disability income insurance, or if you have medical payments coverage on your personal auto policy, then likely you will not need this additional insurance. This coverage costs about $1-$5 a day.
Personal Effects Coverage provides for the theft of personal items that were inside the rental car. If you have a homeowners or renters insurance policy, typically these items are already covered. This coverage costs $2-$5 a day.
Car Rental Tips
-Review your personal auto policy or call your insurance agent before you
reach the rental counter
-If your personal auto policy doesnít cover you in a rental car, inquire about
an insurance rider (this may be nominal compared to all of the daily fees
charged by rental agencies, especially if youíll need the rental car for an
extended period of time)
-Often credit cards include some level of collision and theft protection. If
so, the credit card benefits will be excess over your personal auto policy.
That just means your personal auto policy would pay first and if there is
still more coverage needed then the credit card would pay. Definitely,
contact your credit card issuer. In fact, have them fax the policy language
-If you do not have a personal auto policy or a credit card that provides auto
protection benefits, then it makes sense to purchase both the liability and
collision coverage from the rental agency.
-When you inquire with your auto insurance agent, be sure to ask about
exclusions where longer car rentals will take place.
-If you donít own a vehicle (perhaps you drive a company car provided for your
personal and business use) you may want to consider purchasing a non-owner
auto insurance policy. This policy would provide coverage for a rental car.
-If you are traveling on business, your personal auto policy typically will
not apply, check with your employer regarding purchasing rental agency
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