Am I Covered if I Rent a Car on Vacation?

Have you ever found yourself in this situation? You are standing at a rental car counter, with a line behind you, feeling pressured to buy insurance. It’s a tricky decision, given the fact that you may already be covered through your existing car insurance.

When you rent a car, the car rental company may offer you an insurance plan to cover the vehicle. If you have an auto insurance policy, do you need to purchase the insurance? The good news for Massachusetts Auto Policy holders is that coverage is provided on Mass Auto Policies; however not all coverages will respond in the same way your personal auto coverages respond.

Please keep in mind these important considerations:

Your Mass Auto Policy (MAP) is NOT a worldwide policy! The Mass Auto policy only covers losses that occur in the United States (including Puerto Rico and U.S. territories and possessions) and Canada.

Most rental car companies require all drivers of the vehicle to be declared. Your MAP will only provide coverage for drivers listed on your auto policy for a rental car.

Bodily Injury and Property Damage will apply as long as you are legally responsible for the accident.

Your Collision & Comprehensive coverage provide protection, less your deductible for most damage to a rental car. HOWEVER, many rental company contracts indicate that you are responsible for their loss of rental income while the damaged car is being repaired.

In the event of a total loss or theft of a rented vehicle, the MAP will pay for the actual cash value (ACV). You could end up paying the out-of-pocket difference between the ACV and replacement cost of the vehicle.

Your Mass Auto Policy will only respond to a private passenger type vehicle. It will NOT respond to a motorcycle, motor home, or moving truck. Also, the MAP will NOT respond if a vehicle is rented for an extended period of time over 30 days or is driven off road.

We recommend that you do the following:

Carefully read and understand the rental agreement before signing as not all contracts are the same.

Many credit cards will cover damages to a rental vehicle. Be sure to check available coverage, and if there are any limitations.

Above all, make sure you have some form of insurance on the rental car. The last thing you want is to get into an accident and be underinsured.

Concerned about your personal insurance coverage? At Cleary, our experienced Personal Lines department will work with you to evaluate your insurance needs, identify exposures, and create a customized insurance portfolio. Give us a call today at 617-723-0700.