Does Your Auto Insurance Cover Your Rental Car Anywhere in the U.S.?

As seen on Mercury Insurance Group: 

When Larry Lipparelli rented a car in Dublin recently, he took his online travel agency’s word that the price included all required taxes and fees.

And it did — except for one.

Lipparelli didn’t have the required car insurance for Ireland. A handful of countries, including Jamaica, Israel and Ireland, have specific insurance requirements that all but compel visiting Americans to buy expensive rental insurance. It can routinely double the cost of a rental.

And that’s exactly what happened. Although Lipparelli’s credit card company had assured him that he was covered, and even though his online travel agency promised him the rate included all required fees, an agent turned him down flat when he arrived in Ireland.

No insurance, no car.

His original bill for a weekly rental was $302. But once Lipparelli paid for his policy, it cost $801.

He’s hardly alone. Between one-quarter and half of all travel insurance policies cover overseas car rentals, says the U.S. Travel Insurance Association (USTIA), a trade group. According to Lipparelli, only one credit card would have covered a rental in Ireland, and he didn’t have it.

“Consumers should check with the rental car company ahead of time regarding travel insurance,” says Linda Kundell, a spokeswoman for USTIA.

Or they could check with their car insurance company. For example, Mercury Insurance policies generally will provide the same coverage you have for your car at home when you rent a car anywhere in the United States and Canada.

If you’re renting something you don’t have covered at home, however, such as a motorcycle or scooter then you will most likely need to purchase additional insurance. Your best bet is to talk to your agentbefore you go to get an idea of what your policy covers when you rent a car.

Another benefit: car rental insurance is usually primary, meaning that if you dent your rental on a vacation in Florida, the coverage applies if the loss exceeds the deductible on your policy.

Your credit card may also provide coverage, but the level of protection varies widely depending upon the kind of credit card you have, so it’s a good idea to read your agreement and talk to your credit card company before you rent.

“In many instances your auto insurance will cover your rental car,” says Douglas Menges, chief claims officer for Mercury Insurance. “You may not need to spend hundreds of dollars for that coverage through the rental car company because you could already be covered. You should check with your insurance agent before you leave to make sure you’ll be covered, then you can just say ‘no’ when the rental car agent asks if you want insurance.”

When it comes to insurance, a sound strategy is to check your existing policy — either a credit card or auto rental insurance — before buying the expensive optional insurance offered by a car rental company. In the U.S., your car insurance should cover you for most rentals, but outside the States, check with the car rental company directly before you book a car.

Otherwise, you might experience a little sticker shock when you return your wheels.

Lipparelli, for his part, contacted his credit card company, auto rental company and the Better Business Bureau, but to no avail. Finally, I reached out to his travel agent on his behalf and asked about the extra insurance that had been required.

It cut him a $499 check — a full refund of his insurance.

Christopher Elliott is the reader advocate for National Geographic Traveler magazine and the co-founder of the Consumer Travel Alliance, a nonprofit organization in Washington that advocates for travelers. You can contact him directly at [email protected] or read his blog at http://www.elliott.org.

Robert J. Los Insurance Agency is a family owned independent agency in Hamburg, New York with the knowledge and experience to get you the coverage you need. We work with multiple agencies so you have more options for your insurance plan. Contact us today for more information.