Car Rental Insurance is Tricky Business
Renting a car has never been more convenient with online reservation options, personal pick up and a selection to suit anyone’s preference. But it can get really complicated for those signing on the dotted line if they don’t know how insurance works on their newly rented vehicle.
Rental vehicles in BC come with the minimum $200,000 third party liability insurance required by law, all other coverage including collision, theft, and other damage must be purchased separately.
“The customer is usually responsible for the full value of the rented automobile regardless of fault,” says Craig Hirota, Member Services Manager with the Association of Canadian Car Rental Operators (ACCRO). There are often additional fees such as loss of use, tow and storage, and diminished value that a customer may have to pay out of pocket.
Rental companies will often offer insurance coverage, they call a ‘damage waiver’, that provides protection over and above the legal minimum. It will cover a part or the full cost of any damages not covered by the liability coverage. A quick search of the Avis site showed that insurance starts at $29 a day and goes up from there.
But that’s not a customer’s only option for coverage. Oftentimes, credit cards offer insurance coverage for rental vehicles, as long as it’s paid for through the card. It’s important for customers to research their credit card coverage thoroughly.
A customer’s personal car insurance policy may also include coverage for rental car use. It’s advised to explore the full extent of the protection before refusing coverage when renting a vehicle. Travel insurance may also offer some protection for those wishing to rent a vehicle.
Even if a customer opts into the extra insurance offered by the car rental company, that doesn’t guarantee a worry free trip. There were reports that Budget voided insurance coverage for some customers because they had broken the law at the time of the offence by getting a speeding ticket.
Lisa A. Martini, spokesperson for Enterprise Holdings, says that damage waivers are “subject to the terms and conditions of the rental agreement.”
“Read the fine print,” she says.
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