If you are on the look for an auto insurance policy for a short period of time, there is a big likelihood that you don’t even need to buy it…
Is temporary auto insurance necessary if you are getting a rental car?
The rental service will offer you some combination of liability insurance, personal effects insurance, accident coverage, and/or a loss damage waiver (more commonly known as LDW). If you have your own car and have the respective car insurance, you are most likely covered for each of these 4 insurances. As such, getting even one of them is likely a waste of money. You just have to make sure that you are using the car for recreational and not business use.
Below are the 4 aforementioned insurance types, which the rental service may offer you, and why they are likely not needed…
Liability coverage: The liability insurance on your own policy will protect you.
Loss Damage Waiver or LDW: If you have both collision & comprehensive insurance, you don’t need a loss damage waiver. Your collision insurance covers damage done to your car even if you are found to be guilty in an accident. Comprehensive coverage covers damage done to your car from things such as wildlife and weather. Furthermore, some LDWs, which you can purchase, only cover damage done to the car if you are found to be innocent.
Personal accident insurance or accident coverage: If you already have either Personal Injury Protection, Medical Payments Coverage, or health insurance, you can skip on this additional insurance.
Personal effects insurance: This rental car coverage covers any stolen items. You should know that if you already have renters or homeowners insurance, this insurance is superfluous because both cover stolen property not just inside your house, but outside of it.
To be on the safe side, it is best to call both you car and house insurer to make sure that both policies carry over. Or, you can just read your policy. Its likely that you’ll get some type of insurance from your credit card company as well.
What if you’re not renting, but borrowing somebody’s car?
If you already have your own auto insurance, you don’t have to worry. Also, the car insurance of the lender will transfer over to you. What if you want to borrow someones car and don’t have your own insurance?
Lack of liability coverage is the main thing, which can hurt you, if you are borrowing somebody’s car. If the lenders liability coverage is not enough (say it is $4,000 short of paying for the damages), you are responsible for the difference in an accident in which you are found to be guilty. You don’t have to worry about this happening if you get a nonowners policy, which provides liability coverage for those who borrow others cars. And, as always, if you are the innocent party in an accident, the guilty one will pay for the repairs (this isn’t the case in every state as some are no-fault states).
If you borrow somebody’s auto, who is going to pay for damage done to the lenders car? If the owner of the car has collision and/or comprehensive insurance, they will pay. You may pay if you have these two insurances.
