By Ed Greenberger, THELAW.TV
Millions of Americans will travel long distances for the holidays, and many of those travelers will rent cars when they get to their destinations. If you're renting a car, the rental agent is going to ask you a question you might have heard – and dismissed – before: do you want to purcDon't automatically dismiss extra coveragehase rental car insurance?
"Most people think rental car insurance is unnecessary if they carry auto insurance, but spending a little extra money for rental car insurance could be a wise move," says attorney Martin Sweet of legal information website THELAW.TV (http://thelaw.tv).
Before you rent a car, you should make a couple phone calls – one to your auto insurance agent and the other to your credit card company. If your auto insurance includes collision and comprehensive coverage, then you will be covered if you get into an accident. If you use a credit card to pay for the rental car, your credit card company might automatically provide coverage as well.
Once you get to the rental counter, you will have the opportunity to purchase several different types of coverage:
· Loss damage waiver (LDW) – This coverage generally costs $9 to $19 a day. LDWs will relieve you of your financial responsibility if the rental car is damaged or stolen. They also typically cover towing fees and "loss of use," the rental fees the rental car company will miss while the car is in the shop. Credit card companies often provide LDW coverage if you use their cards to pay for the rental car.
· Liability insurance – By law, rental car companies must provide the state-required amount of liability insurance but these amounts are generally low. If you have liability protection on your own car, you might not need this coverage.
· Personal accident insurance – This coverage costs a few dollars a day. It covers you and your passengers for medical bills for injuries caused in an accident. If you have health insurance or your auto insurance includes personal injury protection, you may not need this coverage.
Are you planning to drive your rental car into Canada? Perhaps you're flying to France and renting a car there. If so, you'll want to check on the insurance limits those countries require. It's possible your auto insurance policy won't be enough.
If you travel with an iPod or a digital camera, you should consider personal effects coverage. This coverage costs just a few dollars a day and provides protection if personal items are stolen from your rental car. Keep in mind homeowners and renters insurance policies often include off-premises theft coverage, which will likely cover you for thefts away from your home, minus the deductible.
There's one final thing to consider – your auto insurance premium. If you decline the rental car company's insurance and get into an accident, you'll have to file a claim with your auto insurance company.
"That could result in the company classifying you as a high-risk driver, which could inflate your premiums," says Baltimore, Maryland personal injury attorney Rick Schmidt of Leviness, Tolzman & Hamilton, P.A. (link: http://thelaw.tv/baltimore/firm/leviness ). "You should always speak with an attorney before speaking with your insurance company."