Whether you're driving a car you own or a rental, you're required to have car insurance in Washington, D.C. and every state except New Hampshire. Even in New Hampshire you're required to have coverage unless you show you have the financial assets to cover the cost of any accident. Depending on your personal car insurance policy you may not need additional coverage when you're renting a car. Knowing how your personal coverage works can help you confidently decline additional insurance options offered by the car rental company.
Types of insurance offered with car rentals
Car rental companies typically offer four types of insurance: loss-damage waiver or collision damage waiver, liability coverage, personal accident insurance and personal effects coverage. The loss-damage waiver is often the most useful, as it covers damage to the car from accidents or theft. The liability coverage protects you in case you get sued for damages. The personal accident protection coverage reimburses you for accident-related injuries. Finally, the personal effects coverage protects your belongings. Though these all sound valuable, you may already be protected from some or all of the potential dangers.
Personal car insurance
Most car insurance policies cover you in any car you're driving for personal use - including rentals - according to esurance, but make sure to check first. If you're renting a car of similar value to your current car your personal coverage is likely sufficient. However, if you're planning on renting a car it's always a good idea to call your insurance company to find out exactly what's covered and what, if anything, isn't covered when you're driving a rental.
If you're taking a trip for work so the rental is technically a business or commercial rental you might not be covered under your personal policy. For example, you generally want both liability and comprehensive coverage on the rental car. If you only carry liability coverage on your personal vehicle, you'll only have liability coverage on your rental under your personal policy.
Credit card coverage
Some credit cards automatically offer you additional insurance coverage on any rental paid for with the card. For example, certain Visa cards offer coverage on rentals for damage stemming from collision or theft as long as you pay for the entire transaction with your card. If you have multiple credit cards, call the customer service departments ahead of time to find out which one has the best benefits. If you have a card that will cover you, there's no reason to pay for the redundant coverage offered at the rental checkout counter.
Other insurance coverage
Other insurance coverage may make the personal accident insurance and the personal effects coverage redundant as well. If you have medical insurance that would cover you if you go to the hospital, it will generally cover you in the event you go to the hospital as a result of a car accident. In addition, your renter's or homeowner's insurance policy may include off-premises coverage, which means even if you're on vacation in Cancun your personal belongings are still protected. However, your off-premises coverage might only cover a certain percentage of your personal property coverage, so check with your insurance agent to make sure you're protected.