Many a time, planning the perfect trip or the most exciting days off includes renting a car. It’s convenient, it makes moving from one destination to the other simpler and it allows us to choose the route we like best to reach our destination.
However, despite the excitement, renting a car can be a painful experience for the uninitiated. For example, the daily rental price might look low, but the insurance policies that you’re offered at the counter can dramatically increase the total cost of your rental. Using your car insurance policy (if it includes car rental damage insurance) has it’s drawbacks; if you have to make a claim, you are likely to pay a deductible between $500-$1500, and claiming on your auto policy can increase your premium by up to 44%. It is true that most credit cards offer renters some level of coverage, however they usually don’t draw your attention to the fact that it is only secondary insurance: which means if the renter has an auto policy, they will have to claim on that first.
Leaving the car rental depot without some sort of damage coverage is definitely not a wise idea, especially not if you’d prefer to have some peace of mind. Keep in mind that rental cars in the US do not have comprehensive insurance coverage, which could leave the renters having to pay for the full value of the car if it was written off or stolen.
On top of that, roads can be dangerous, you may meet reckless drivers and accidents (even minor ones) do happen, not to mention the car being scratch in the shopping mall car park. In such a context, enjoying that sense of relief that comes from knowing that you are covered is priceless. That said, a new type coverage, called third-party car rental insurance, is getting a lot of attention and traction with renters. In this article, we’re going to discuss the different reasons why it can be a smart move.
When compared with the other insurance policies available for car renters, the one offered by third parties such as Bonzah.com stands out for being significantly more affordable while offering ample coverage. Car rental companies usually charge as much as $30-$40 per day, which can be more than the actual rental.
Avoid Hard Sell
Any regular renter well knows that sinking feeling, when the rental car agent says; “you normally take the insurance don’t you?” And when you say no thanks, they go through their spiel explaining all the reason you should buy it. Well, when you pre-purchase your own car rental insurance option (or even just before picking up the rental), you can simple say “no thanks, I already have damage insurance coverage”
Don’t Risk a Premium Hike
If you have an auto insurance policy, making a claim related to your rental car can lead to a big premium increase. The National Association of Insurance Commissioners (NAIC) have concluded that first time auto policy claims on average leads to a 44% premium increase. On top of that, you’ll need to pay a hefty deductible. Ouch!
Read the Credit Card Fine Print
Many renters rely on credit cards that include rental cover coverage. This can be a reasonable and an affordable option, but make sure you understand the fine print. For example, credit cards are pretty much always just a secondary insurance. This means you would need to exhaust your other primary options first, such as auto insurance, before credit card coverage would play a role. Credit cards often also have coverage exceptions i.e. they may not cover windscreens, tire damage, loss-of-use and diminished value. It all adds up, so check the fine print!
Plug the Car Rental Insurance Holes
Third party car rental damage insurance companies usually cover a high enough amount to cover the full replacement of the car as well as the following incidents:
- Damage due to collision, theft, vandalism
- Damage due to windstorm, hail, fire of flood
- Damage due to any cause not in your control
- Zero Deductible
- Global Coverage
Additionally, several companies offer additional services that can be attractive, especially for drivers covering many miles and driving through remote areas. Most of these additional services are related to roadside assistance and can be purchased as an optional extra:
Emergency Roadside Assistance Includes the following:
- Towing Assistance
- Flat Tire Assistance
- Collision Assistance
- Fuel Oil and Water Delivery Assistance
- Battery Services
- Lock-out Assistance
As you can see, buying your car rental damage insurance from a third party is an alternative that you should consider next time you rent a car.