Should You Buy Rental Car Insurance When Traveling?
- Vincent Fuccilli
- 2 hours ago
- 5 min read
One of the most common questions drivers ask at the rental car counter is: “Do I really need to buy the rental car company’s insurance?”
Many drivers assume their personal auto insurance or credit card coverage fully protects them while driving a rental vehicle.
Sometimes it does.
However, many insurance professionals suggest to purchase the rental car company’s insurance coverage anyway — especially during vacations, business trips, or unfamiliar travel situations.
Why?
Because if a rental vehicle is damaged and a claim is filed through your personal auto insurance policy, the claim may still:
appear on your insurance history
count as claim activity
affect underwriting reviews
potentially impact future pricing or eligibility
This article explains how rental car insurance works, what your personal auto policy may cover, and why purchasing the rental company’s protection may sometimes be a smart decision.
Does Your Personal Auto Insurance Cover Rental Cars?
In many situations:
yes.
Personal auto insurance policies may extend certain coverages to temporary rental vehicles used within the United States and Canada.
This may include:
liability coverage
collision coverage
comprehensive coverage
However:
deductibles may still apply
coverage limitations may exist
certain vehicle types may be excluded
international rentals may not be covered
Coverage depends heavily on:
policy language
carrier guidelines
rental location
vehicle type
how the vehicle is being used
Drivers should never automatically assume full protection applies.
What Rental Car Companies Usually Offer
Rental companies commonly offer:
Collision Damage Waivers (CDW)
Loss Damage Waivers (LDW)
Liability coverage
Personal accident coverage
Personal effects coverage
The most common protection drivers consider is:
Collision Damage Waiver (CDW)
A CDW may help protect renters from paying for damage to the rental vehicle without filing a claim through their personal auto insurance policy.
Why Many Insurance Professionals Still Recommend Buying Rental Car Insurance
This is where things become important.
Even if your personal auto insurance extends coverage to rental cars:
filing a claim may still affect your insurance history.
For example:
you back into a pole in a parking garage
someone damages the rental vehicle
windshield damage occurs
the rental vehicle is stolen
a collision happens during vacation travel
If the claim goes through your personal auto insurance:
deductibles may apply
claim history may be created
underwriting reviews may be affected
future pricing or eligibility could potentially change
This is one reason many insurance professionals personally choose to purchase the rental company’s coverage during:
vacations
business travel
unfamiliar driving situations
high-traffic areas
frequent travel
Rental Car Claims Can Still Count as Insurance Claims
Many drivers assume: “It’s just a rental car.”
However, if your personal insurance company pays for damage to the rental vehicle, the incident may still:
appear on claim history databases
count as claim activity
affect underwriting reviews
This does not necessarily mean:
your rates will immediately increase
or
every claim will affect eligibility
But insurance companies often review: overall claim frequency —not just major accidents.
This is similar to:
roadside assistance claims
glass claims
towing claims
small comprehensive claims
Repeated claim activity may matter over time.
What About Credit Card Rental Car Coverage?
Some credit cards offer rental car protection benefits.
However:
coverage varies significantly
many programs provide secondary coverage only
exclusions may apply
luxury vehicles may not qualify
international limitations may exist
Some credit card protections may reimburse deductibles or excess expenses rather than replacing primary insurance entirely.
Drivers should carefully review:
benefit guides
exclusions
claim procedures
rental limitations
before relying solely on credit card coverage.
International Rental Cars May Be Different
Many personal auto insurance policies do not extend coverage internationally.
This is especially important when traveling to:
Europe
Mexico
Caribbean destinations
South America
other foreign countries
Rental company insurance may become much more important during international travel.
Drivers should always confirm:
territorial coverage
exclusions
liability requirements
rental restrictions
before traveling abroad.
What Happens If You Decline Rental Car Insurance?
If you decline the rental company’s coverage and damage occurs:
your personal insurance may become involved
deductibles may apply
claim activity may be reported
out-of-pocket expenses may exist
You may also become responsible for:
loss of use charges
diminished value claims
administrative fees
depending on:
state laws
rental agreements
insurance carrier handling
Why Some Drivers Prefer the Simplicity of Rental Company Coverage
Some travelers simply prefer:
avoiding the insurance claim process entirely.
Purchasing the rental company’s protection may:
reduce stress
simplify claims
avoid deductibles
avoid involving personal insurance
provide peace of mind during vacations
Especially for:
infrequent travelers
families on vacation
business travelers
luxury rentals
unfamiliar locations
the added cost may be worth it.
Is Rental Car Insurance Always Necessary?
Not always.
Some drivers may already have:
strong personal auto coverage
umbrella coverage
primary credit card protection
low deductibles
minimal travel exposure
However, drivers should understand:
“covered”
does not always mean:
“without consequences.”
Even covered claims may still affect:
claim history
underwriting
future eligibility
insurance strategy
Why Understanding Your Coverage Matters
Many drivers focus only on:
“How much does the rental insurance cost?”
But they may not consider:
claim frequency
deductibles
underwriting exposure
future pricing
stress after an accident
international exclusions
Understanding these issues can help drivers make more informed insurance decisions while traveling.
Why Independent Insurance Agencies Matter
Different insurance companies may treat rental vehicle claims differently.
Independent insurance agencies can help drivers:
understand rental car coverage
review policy limitations
evaluate deductibles
understand claim implications
discuss travel-related insurance concerns
At Bergen Insurance Group, we help New Jersey drivers better understand their auto insurance protection before claims happen.
FAQs
Does my personal auto insurance cover rental cars?
In many situations, yes. Personal auto insurance may extend certain coverages to temporary rental vehicles, subject to policy terms and limitations.
Should I buy rental car insurance while traveling?
In many situations, purchasing rental car company coverage can provide added protection, convenience, and peace of mind — especially if you want to avoid filing claims through your personal auto insurance policy.
Can rental car claims affect my insurance?
Possibly. Claims involving rental vehicles may still appear on insurance claim history and could affect underwriting reviews depending on the carrier and claim frequency.
Does credit card coverage fully replace rental car insurance?
Not always. Credit card rental coverage varies significantly and may include exclusions, limitations, or secondary coverage requirements.
Is rental car insurance more important for international travel?
Yes. Many personal auto insurance policies do not extend coverage internationally, making rental company coverage especially important abroad.
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Disclaimer
The information provided in this article is intended for general informational purposes only and should not be interpreted as insurance, legal, or financial advice. Rental car insurance coverage, claim handling practices, underwriting guidelines, credit card protections, exclusions, and eligibility requirements vary by insurance company, rental company, and individual situation. Please contact Bergen Insurance Group to review your specific insurance coverage needs and travel-related protection options
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