May 12, 2020
What You Need To Know About Rental Car Insurance In Canada
Rental car insurance causes a lot of confusion. Do you have it in your auto insurance policy? Do you need to get coverage from the rental car place? Are you covered? Are you not covered?
What you really want is the best rental car insurance. Perhaps you are taking a vacation and need a car. Or you need a rental while your car is in the shop. You want affordable rental car insurance that gives you the coverage you need. We’ll provide you with some clarity about your options.
Here you’ll get the information you need to know about rental car insurance coverage :
- Get a definition of rental car insurance
- Learn about the types of rental car insurance coverage
- Find out if you need coverage or already have it
- Get answers to common question about your options
What Is Rental Car Insurance?
Rental car insurance is self-explanatory. It is a form of coverage for rental cars. In general it refers to one of two things. Rental car insurance from a car rental agency or coverage for rental cars within your personal auto insurance policy. For example, some policies include rental car costs if your vehicle is getting repairs due to accident damage.
Much like standard car insurance, there are many different types of rental car insurance. Coverage is available to protect the vehicle, your personal belongings, and liability.
Where Can I Get Rental Car Insurance?
You have a number of potential sources to get rental car insurance coverage. The option you choose will affect your coverage type, limits, and costs.
Here are the most common places to get coverage :
- The Car Rental Company : This is the insurance coverage rental cars offer you when you pick up your rental. It covers you for some damage to the rental car, but there are exclusions. A daily rate on top of the rental fee applies.
- Credit Card : You may have coverage through our credit card if you book your rental using the card. Terms and conditions apply. The cost varies based on your card type and provider.
- Your Auto Insurance Policy : Most insurers offer optional coverage that covers damage to vehicles you don’t own. This is a policy endorsement known as Legal Liability For Damage to Non-Owned Automobiles. Most refer to it as rental vehicle insurance. When you have this coverage, you can use it for rental cars. You don’t need the coverage from the rental agency or your credit card.
Do I Need Rental Car Insurance?
The short answer is yes. If you rent a car, you need some form of insurance to protect the vehicle and yourself. Without coverage, you would have to pay for any damage out of pocket that is above the basic coverage provided.
You need to determine if you need coverage from the rental company or from your auto policy. If you don’t have a vehicle, you can get coverage from the rental company or your credit card.
How Do I Know If My Insurance Covers Rental Cars?
There are a couple ways to find out if you have rental car coverage. The first is to check your policy. If you have the OPCF 27 policy endorsement, you’re covered. You can use this coverage for rental cars in Canada and the United States.
The other way to check is to contact your insurer. They will be able to tell you if you have coverage and how much you have.
What Are The Different Types of Rental Car Insurance?
- Collision damage waiver (CDW) : Also called loss damage waiver (LDW). It provides protection from costs for theft or collision. This is not insurance. You pay to rental car company to forfeit the right to go after you for damages.
- Liability insurance (LI) : You get protection from being liable for an accident. It covers you if you are at fault.
- Personal accident insurance (PAI) : This is accidental death coverage for the driver and any passengers. Benefits amounts vary.
- Personal effects coverage (PEC) : Protection for your personal items in the vehicle.
You need to have collision and rental car liability insurance. PAI and PEC are optional. All of these types of coverage from the rental car agency are available through your personal insurance policy.
When Should I Buy Rental Car Insurance?
If you travel frequently, adding rental car coverage to your auto policy makes sense. It will cost you less than paying for coverage from the rental car company each time you rent a vehicle.
Keep in mind that the OPCF 27 rider is also applicable to other vehicles you don’t own. For example, if you drive your parents vehicle or a friends vehicle occasionally.
Rental Car Insurance FAQs
Here are some additional questions about rental car insurance coverage :
You need some form of insurance coverage when you rent a car. Without coverage, you would have to pay out of pocket for any damage. Even a minor accident could cause thousands of dollars in damage.
It depends on your policy. Some insurers have a set amount they allot for a rental. For example, you may have $2000 in rental car coverage. If you open a claim and require a rental car, your insurer will usually notify you of coverage limits. Check your policy details to confirm.
It is a good idea to purchase collision insurance from the rental car company if you don’t have a personal auto insurance policy. If you already have insurance, you may be covered for your rental.
Your third party liability coverage does not cover rental cars. You need the additional Legal Liability For Damage to Non-Owned Automobiles rider to have coverage.
Yes, if you have the right type of coverage. Not all policies include coverage for rentals. Speak with your insurer to see if you have the right coverage in place.
It depends on your policy. If you have OPCF 20 rental car coverage rider, you can get a rental. A quick call to your insurer will let you know for sure.
No. Comprehensive insurance does not cover rentals. You need the additional Legal Liability For Damage to Non-Owned Automobiles rider to have coverage.
Yes. You can get a rental car without personal insurance. Rental cars automatically come with basic insurance. However, the basic amount is minimal. Any damage above these limits you would have to pay for out of pocket.
No. Insurers do not have to provide you with a rental. Check your policy to see if you have rental car coverage (OPCF 20).
In most cases, you do not need to show proof of insurance to rent a car. Requirements vary based on the rental company rules.
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