Understanding Car Rental Insurance

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If you are being offered to purchase car rental insurance, would you buy it? Well, normally you would not. But did you know that there are cases where car rental insurance is needed? If you are on this shoe or just interested to know more about car rental insurance, then read on.

When Not To Buy Car Rental Insurance

People rent vehicles all the time for few good reasons. It could be that their own vehicle is currently being serviced, going for a vacation, wanting to drive around in a foreign country or just about anything.

Now, if you already have an insurance, then there’s no need for you to buy additional car rental insurance because normally, you are already covered. Also, if you use credit card to pay the bills, the liability is normally shouldered by your card issuer. However, because majority of the policyholders do not know about this, they are forced to believe that they need it when in reality they do not. Who wouldn’t? All you care is your safety or your family while on the road.

Bob Hunter, a former Texas Insurance Commissioner, explained that this carefully planned rip off is orchestrated by both the car agency and the insurance company themselves. The latter would agree to pay a huge kickback every time a customer rent a car. In the end, an unsuspecting customer would have paid ridiculously high premium rates.

One very attractive claim that a car rental insurer will tell you, is that whenever you encounter accident using their policy, your own insurer will not find out because you would not file any claims with them. As with any other fraud, this is one dangerous blatant lie. You may not file any claims with your own insurer but when the report becomes public and your own insurer will know, chances are rates will still go up high.

When to Buy Car Rental Insurance

Car rental insurance is not all-time evil policy. There are cases that it is better to have one than nothing at all. We all know that most insurance companies take care with their customers most of the time, but sometimes, especially if you are travelling outside the country, it is best to get a separate temporary insurance policy in this case.

If you are travelling to Canada, then there is not much of a problem. However, in Mexico, things are a bit different. If you are planning to drive around the country, and you encountered an accident with no Mexican issued insurance policy, you will be in hot waters. Mexican courts do not recognize international policies, so it is better to get a temporary insurance or use the public transportation instead. 

This may be true for some other countries as well, so it is best to verify their insurance regulations ahead of time for your own safety. The fastest way is to contact your own insurance provider or credit card issuer you are planning to use to purchase the bill. They may be able to give you some hints on where and how to be protected throughout your visit.