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Do I need to purchase extra insurance when renting a car?

You have been waiting in line long enough and before you can take the keys and start exploring the new city, you are asked by the car rental agent – would you like to purchase rental insurance?

The answer – it depends.

In most cases, your existing car insurance will automatically extend accident benefits and third party liability coverage to the rental vehicle. The limits would be the same as those on your own vehicle.

Physical damage to the rental vehicle may be covered if you carry it on your own vehicle. However, if you have basic coverage, physical damage or a loss to the rental vehicle will not be covered.

There are certain exceptions with your coverage you need to be aware of. Depending on your provider and/or situation, you may need additional coverage to be fully protected while driving a rental car. For example, the type of vehicle you rent affects your coverage. Moving vans, trailers, luxury and recreational vehicles may have limited or no coverage under your policy.

Does my credit card provide rental car insurance?

Sometimes your credit card offers coverage for damage or theft to your rental car when you put the rental cost on the card. Check the fine print or call your financial institution to see exactly what is and is not covered.

Should I pay extra for the car rental company’s coverage?

Although a more expensive route, most car rental companies offer additional coverage with added benefits such as roadside assistance.

However, if you need extra coverage for your rental car, for a lower price you can purchase additional coverage by adding an annual endorsement to your existing insurance policy.

Before you travel, speak with a BrokerLink broker to ensure your rental car is covered under your existing car insurance policy to prevent any surprises later.

Note: This information applies to rental cars in Canada and the United States. If you are considering renting a car outside of Canada and the United States, contact your BrokerLink broker.