Who's Covered Under Rental Car Insurance?

Is it two for the price of one? Not always when it comes to rental car insurance. Finally going away on that long-awaited vacation? If you'll be renting a car and sharing driving duties with someone else, there are a few things you should know about rental car insurance before you go. Your own auto insurance

What and Who is Covered?

Auto insurance coverage varies from one insurer to another. Some policies may not cover rented vehicles at all. Many others will cover damage you cause to any car that you're driving, including a rental car. Your insurance may also protect you from liability claims up to the policy limits.

Even if your policy provides coverage, you need to know exactly who's covered. Are you and the other listed drivers on your policy the only ones covered while driving the rental car, or are other drivers covered, too? The only way to find out is to ask your insurance company or agent. If your fellow travelers are not covered, you might ask about coverage offered by the rental car company.

Note: Read your policy's fine print to see if any restrictions apply to the rental car coverage. For example, some policies may cover a rental car only when your own car is stolen or being repaired.

Credit card coverage

If you have a major credit card, the credit card company may provide some insurance coverage for your rental car itself (but typically no liability coverage). This coverage may be included in your account at no additional cost, or you may have to buy it separately. Check with your credit card company to find out what coverage you have and who's covered. In all likelihood, you (the cardholder) will be the only one covered while driving the rented vehicle.

Coverage from the rental car company

Rental car companies offer various types of loss waivers and insurance protection, usually for an additional cost. If you buy insurance from the rental car company, it may become your primary coverage. Be aware that you (as the renter of the vehicle) are generally the only one authorized by the company to drive the vehicle. This means that the company's insurance might not apply when other people are driving the vehicle. But there are a few exceptions:

In a few states, your legal spouse is considered an "authorized operator" of the vehicle and may drive it with your permission.
If you rent under a corporate account, your employer, employees, or fellow employees on a business rental may be considered "authorized operators" who can drive the vehicle with your permission.
You can add "additional authorized operators" who, if approved in writing, may drive the vehicle. Additional operators generally must be at least age 25 and have a valid license and a major credit card. An additional charge (e.g., $5 a day) may apply for each driver that you add.
These individuals are generally covered by any insurance you buy from the rental car company, but be sure to verify this with the company at the time you rent a vehicle.