Rental Car Liability Insurance
Posted on | August 30, 2013 | Comments Off
When it comes to renting a car, there are many insurance options you can choose from to protect yourself and the rented vehicle. Each option differs from the other in terms of cost and the coverage. Therefore, deciding as to which option is the most suitable seems to be considerably difficult. However, rental car liability insurance appears to be the best choice in case you rent a car for a shorter duration – ten days or less.
Rental car liability insurance is a low-cost insurance policy with a selected number of benefits. Basically, it is an agreement between the insurance company and the insured person, in which the latter pays a specific amount of money, and receives protection against certain liabilities from the insurance company within the policy limits.
Usually, two types of protection are offered by this policy:
1. Bodily Injury Liability
The rental car liability insurance will protect you from any liabilities filed against you in case you are responsible for bodily injury or death of other persons. Your insurance company will bear the loss you caused to the affected person. The loss includes medical bills, ambulance charges and other financial hardships like wages for the days the injured person remains in the hospital.
2. Property Damage Liability
The rental car liability insurance will also protect you from the claims filed against you for the damage of property of other people in the event of an accident for which you are at fault. Generally, property includes another person’s vehicle damaged due to your accident. However, damage to telephone poles, fences, lamp posts and other buildings is, sometimes, also covered by the same policy.
The Downside of Purchasing Rental Car Liability Insurance from a Rental Agency
No doubt the majority of rental agencies offer rental car liability insurance in one form or the other. But they mostly carry the minimum amount of liability protection as required by their respective states. And this minimum is rarely enough to protect your interests in case you seriously injure someone or severely damage someone’s property.
For instance, law requires rental agencies based in New York to carry $50,000 bodily injury liability coverage, and $10,000 property damage liability coverage. So if you purchase a rental car liability plan from New York, and happen to be the reason of an accident causing serious injuries to another person or severe damage to his property, you will be liable for all expenses exceeding the above amounts.
The Way Out: Excess Liability Insurance
Due to the disadvantage of basic rental car liability insurance policy mentioned earlier, it is recommended that you demand your rental agency to provide you with “excess liability insurance”. Though costly because you have to pay $10 to $15 per day, it will cover you for bodily injury and property damage liabilities exceeding the standard amounts set in accordance with the state requirements. In general, excess liability insurance offers one million dollars’ worth of excess protection, which is surely a boon for any renter.