If I Get in an Accident on Vacation – Will my Insurance Cover it?

Accidents happen, even on vacation. So how can you protect yourself and a rental car? In this information, we will explain what you need to do to make sure your rental car is covered.

Q: So, does your regular insurance plan cover a rental, if you are involved in an accident on vacation?

A: If the individual who is driving the rental car is listed on your insurance policy and the policy is collision coverage with comprehensive, then the rental will be covered through your personal policy. Additionally, in order to be covered, the driver needs to be listed on the rental contract. Moreover, the deductible amount listed on your insurance policy will probably apply to the rental car, as well. Every company is different, however, so it helps to read the fine print of your rental contract and insurance information. 

Aside from your regular insurance policy, there is another way of being covered while driving a rental on vacation: Rental Insurance. Rental car insurance is a great option for those who only have liability coverage or do not have collision coverage.

The cost of rental insurance is around $20 to $40 per day. While this may seem pricey for insurance that you most likely, will not need – it beats the alternative of having to replace or repair the vehicle out of your own pocket.

There are several advantages to signing up for car rental insurance. For instance, if an accident occurs, your personal auto insurance premium will not increase because of it. In addition, to keeping your premiums low, if at fault, there is typically no deductible, which is unlike traditional insurance where you always have to pay a deductible. In addition, many vacation destinations are in unfamiliar locations that can be confusing, which increases the risk of an accident.

There are also disadvantages to signing up for rental insurance. The most obvious disadvantage to rental insurance is the cost, which can add up — especially on a long vacation. Also, you will have to pay the deductible, in the event that an accident occurs and it is ruled, your fault. In addition, you will have to deal with the insurance company if something does happen. 

Full coverage policyholders are fully protected, if the rental car is damaged and if another vehicle is involved in an accident, any damages or injuries sustained by them will be covered under your auto insurance policy, as well. The major insurance companies commonly require that you pay the deductible listed on your policy to cover any repairs to the rental car, so it is important to know the amount of the collision deductible. It may be a good idea to lower your deductible while you will be on vacation, therefore, in the event that something happens you will not have to pay so much out of pocket. The major disadvantage to using your insurance during your vacation is if the accident was deemed your fault, then it will typically raise your insurance premiums by 15 to 30 percent for the next three years.

Before you start enjoying your vacation, you may want to start by addressing your insurance needs when you plan your trip. While the cost of rental insurance or traditional car insurance can be expensive, choosing to protect yourself on vacation is one of the smartest things you can do to plan for your trip.

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