Rental car insurance? You might already be covered

(August 2012) – If air travel plans are in your future, chances are good you'll drive a rental car. When you meet the customer service representative of the rental agency, one of the first questions he or she is likely to ask is whether you want to buy the optional insurance.

What do you do? Your initial reaction may be to take the peace of mind that comes with the insurance. Especially when there is a line of impatient travelers waiting behind you, there's the temptation to just get the transaction over with as quickly as possible. But before you cough up the daily insurance fee, measure your options carefully. You may not need to purchase additional coverage.

If you already have an auto insurance policy, that policy might cover your rental car. Additionally, if the car is rented with a major credit card, the credit card company often will cover cost of any damages incurred. This coverage normally only kicks in after your original insurance reaches its limit.

Even if you don't own a car but regularly find yourself renting cars, you may be able to purchase a policy through your insurance agent that will help you avoid the costly rental company fees. Called a non-owner liability policy, this insurance generally costs a couple hundred dollars. For someone who rents fairly often, a non-owner liability policy can be cheaper than daily rental company insurance. Be aware that in most states, this covers only the liability portion of the claim. The vehicle damage to the actual rental car is not covered and separate insurance may need to be purchased from the rental agency.

Before you take a trip involving a car rental, call your insurance agent and your credit card company to determine if you're already insured ... and to what extent. Nothing puts a damper on a vacation more than being left on the hook for thousands of dollars in rental car damages.

So next time you are renting a car, check your coverage first. You might already have peace of mind without giving up a piece of your wallet.

Based in Madison, Wis., American Family Insurance offers auto insurance, homeowners insurance, life insurance, health insurance, business and farm/ranch insurance in 19 states. American Family insurance is the nation's third-largest mutual property/casualty insurance company. Web:; Facebook:; Twitter: