Personal Injury

What If I Crash a Rental Car and I Didn't Buy the Insurance?

By David Berg, Attorney
Declining the rental car company's offer of insurance at the counter doesn't necessarily spell trouble if you end up in an accident, especially since your own car insurance will likely have you covered.

The answer to this (fairly common) question typically depends on three factors: 1) whose fault the accident was, 2) whether you paid for the rental car with a credit card that provides for rental car insurance, and 3) whether your own car insurance covers damage to rental cars. We'll dive deeper into these factors, and more, in the following sections. (Get the basics on Rental Car Accidents.)

Always Be Careful When Renting a Car

When you rent a car, the long (and often difficult to understand) contract states that you are responsible for any damage to the vehicle, regardless of how the damage was caused. That is why, when you rent a car, you need to examine it very, very carefully before you leave the rental car lot, note any damage on the form that they give you, and make sure to keep a copy for yourself. If the car gets the slightest scratch while you rented it, the rental car company could charge you for that damage regardless of whether it was your fault, someone else’s fault, or no one’s fault.

Your Own Insurance or Your Credit Card May Cover the Rental Car

Most car insurance policies provide coverage when the policyholder is driving a rental car. You will have to read the fine print of your policy carefully to see if it covers rental cars, and if so, what kind of coverage is provided. But if you can’t figure it out, call your car insurance agent and make sure you understand and are comfortable with the details before you turn down the rental company's offer of coverage.

Regardless of whether your own car insurance provides coverage, many credit cards provide for rental car insurance, as long as you rent the car using that card. Credit card rental car insurance generally covers all property damage, regardless of whose fault the accident was, and may even cover some personal injury damage, depending on the card. But note that credit cards sometimes provide only secondary coverage, meaning it covers any damages that exceed the limits of your primary insurance policy, so again, read the fine print of your card agreement or call the card issuer and get the details on rental car insurance for cardholders. And remember, in order to qualify for your credit card’s rental car coverage, you need to use that credit card to reserve the rental car, use that credit card again to pay for the rental car, and report any accident or damage immediately to your credit card company. (Learn more about What to Do After a Car Accident.)

If You're Not Already Covered, It Depends Who Was at Fault

But if you cause a car accident, you don’t have your own car insurance, your credit card doesn't provide rental car coverage, and you don’t purchase the rental insurance from the rental car company, the rental car company is going to look to you to reimburse them for any damage. And if anyone else was injured in the accident, damage to the rental car might be the least of your financial concerns. Learn more: What If I'm Sued for a Car Accident and I Have No Car Insurance?

But if another driver causes the accident, his or her insurance company will be liable for the property damage to the rental car up to the policy limits. You would report all of this to the rental car company, and they may very well decide to work directly with the other driver’s insurer to work out the property damage. But beware: It's always possible that the rental car company might not want to wait for the other driver’s insurance company, and might just go ahead and charge your credit card for the damage, which means you'll probably have to deal with the at-fault driver's insurance company in order to get reimbursed. Learn more about How Insurance Affects a Car Accident Case.)

If you've been involved in a car accident within the last three years, please consider taking our car accident survey so that we can include your experience in Martindale-Nolo's 2016 Car Accident Survey. Your participation will help inform others about their situation and options before dealing with their car accident.

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