Rental Car Insurance

Not everyone can afford to purchase a car. It is not just the amount of money you have to invest in purchasing it but also the amount of money you have to invest in maintaining it. If you do not wish to own a car then you have the option of renting one. You can choose to rent a car for a day or several months but here comes a genuine question, what if you meet an accident while driving the rental car? This is where the rental car insurance comes up.

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Need of Rental Car Insurance

Be it a personal car or a rental, the safety of the car, as well as the driver, is a priority. An accident arrives announced but what you can do is get covered under insurance that can provide coverage for the loss or damage caused by the accident. If you are planning to rent a car that means you do not own one and might not be aware of how rental car insurance works. So, let us move ahead and tell you how it works.

Rental Car Insurance: How It Works?

Rental car insurance differs from personal car insurance. Apart from fulfilling the legal liability, the objective of an insurance plan is to provide coverage to the policyholder for the expenses that occurred in repairing or replacement of the damaged part. Also, the coverage provided by the insurer depends upon the geographical location of the rented car. So, here are the types of coverages provided under the rental car insurance.

Third-Party Liability Insurance

Third-party liability insurance is mandatory in India. However, it provides coverage for the loss or damage caused to the third party in an unforeseen accident.

Collision Damage Waiver

The collision damage waiver will provide cover for the damage caused to the car. The CDW will only provide coverage for the damage caused to the body of the rented car and not for the tyres, battery, windshield, engine, gearbox or any other interior damage. But the insurer will not provide cover if the driver is found driving the car under the influence of alcohol or drugs.

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Theft Cover

The rental car insurance also provides cover for the theft of a rental car so that you do not have to pay for the stolen car to the rental company. It also provides cover for the damages that occurred while attempting to steal the car.

Significance of Rental Car Insurance

Rental car insurance provides coverage against theft, damages as well as loss or damage caused to third-party. Here are some of the benefits of rental car insurance:

Super Collision Damage Waiver

A collision damage waiver provides cover for the body of the car whereas a super collision damage waiver provides coverage for several parts of the car.

Personal Accident Insurance

If you or any other passenger in the rented car gets injured, personal accident insurance provides coverage for the medical expenses incurred in the treatment.

Roadside Assistance

If the rented car breaks down, runs out of fuel or tyres get punctured during the journey then assistance will be provided so that you get out of that situation.

Uninsured Motorist

In case you meet with an accident and the driver of the other vehicle is not insured then uninsured motorist protection will provide cover for the injury or damage caused.

Full Protection

If you opt for this cover then this will provide cover for all the cover mentioned above such as theft, damage, roadside assistance, uninsured motorist, etc.

Check These Things Before Purchasing Rental Car Insurance

When you decide to purchase rental car insurance then make sure to check these things.

Maximum Limit of Collision Damage Insurance

It depends on the value of the rented car and the rental company but it is suggested to check the maximum limit of the collision damage. It is because if the claim amount exceeds the coverage provided by the insurer then you will have to pay the extra amount out of pocket.


There will be a deductible amount in rental car insurance and you might have to pay some amount to get coverage for the damage but if you have complete coverage and zero deductible coverage then you will not be liable to pay the deductible.

Roadside Assistance Cover

Check if the roadside assistance cover is included in the standard coverage of the rental car insurance or comes as an add-on.


Purchasing an insurance plan has become an easy task now as you can simply visit the website of an insurer and make the purchase. You also have the option of comparing the insurance plans and then purchasing as per your requirement. Apart from this, you can even calculate the premium amount using the online premium calculator tool so that you can check if the rental car insurance plan fits your budget or not.

Written By: PolicyBazaar - Updated: 15 November 2021
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