Insurance tips for first time renters

Renting a car for the first time can be somewhat bewildering. There is the daily rental price, taxes and surcharges and optional add-ons to contend with, as well as premium location pick up fees to ponder and pre-filled gasoline payments to consider. When it comes to insurance, most people are too busy or bored to deal with the fine print and simply sign on the dotted line.

In some countries, insurance with a car hire company is a requirement of every rental but in other cases, you may already be covered and not need their insurance, or you might not be covered enough and could benefit from a stand alone car hire insurance product.

Most people pay for their car rental with a credit card and as a result, they are usually given some degree of protection against theft and damages from Visa or MasterCard. Before making a booking, make a quick call to your insurance agent and credit card company and ask what’s covered. It could save you spending on an unnecessary expense.

“More often, these prestigious cards are starting to change the advantages they offer to their cardholders, and often times the cardholders are unaware,” said Carolyn Gorman, vice president of the Insurance Information Institute in New York. “You could be driving uninsured and not even know it, until you get into a bad accident and have no insurance to cover you. It’s a dangerous, scary thing.”

For those who don’t have coverage from elsewhere, choosing a policy can be difficult as most companies offer a variety of options and a range of prices.

“This is just a classic way for these companies to make more money,” said Greg Daugherty, an executive editor at Consumer Reports magazine. “This is usually money that people are spending unnecessarily.”

To avoid making a costly mistake, Carolyn Gorman recommends travellers take time and plan ahead. “The worst is when you are standing at the counter, with a line behind you, and you feel pressured to buy it all because you don’t have a sense of what kind of coverage you need and what you don’t,” she said. “That’s when you make bad decisions in a haste.”