California Rental Car Insurance
Oftentimes drivers renting a vehicle get Collision Damage Waivers (CDW) and California Rental Car Insurance confused and as a result do not have adequate coverage when leaving the rental lot in a vehicle. Under California law, all drivers are required to carry two forms of liability insurance, Bodily Injury and Property Damage.
Collision Damage Waiver vs. Rental Car Insurance
Damage waivers are not automobile insurance and simply release the renter from being responsible for any damage to the rental vehicle in the event of an at fault accident. CDWs also cover loss of use for the rental vehicle while it is out of commission and unable to be rented out.
Personal Automobile Insurance & Rental Vehicles
If you have automobile insurance, chances are your policy will cover the rental vehicle but this may not always be the case. Read your policy carefully to see exactly what types of coverage you have and whether or not it will cover the rental vehicle. If you do not carry collision and comprehensive you would most likely need a CDW or rental car insurance.
Credit Cards & Rental Car Insurance
Sometimes the rental vehicle is covered under certain conditions if you use your credit card that comes with that type of insurance. There are different levels of coverage provided by different credit card issuers so check your documentation thoroughly before assuming you have the legal required coverage.
Rental Car Insurance and Injuries
Also, take into consideration that should you be found at fault in an accident with injuries in your rental vehicle or any other vehicle or pedestrian involved, you may be held liable for their injuries and any resulting medical bills and lost wages in some cases if you do not have adequate rental vehicle insurance.
Insurance Requirements in California
The State of California requires drivers to carry 15/30/5 which means $15,000 in bodily injury or death benefits per person with $30,000 as the minimum to cover all injured. The 5 stands for $5,000 in property damage which would cover the other vehicle and/or any property involved. Bodily injury refers to any person not in your vehicle.
When Rental Insurance Is Not Needed
Under State Law, residents of California can show financial responsibility by depositing an amount of $35,000 with the Department of Motor Vehicles to be used in lieu of automobile insurance should the driver be found at fault. However, this may not meet the insurance regulations in other states if the rental vehicle crosses the state line. In this instance, California car rental insurance would almost certainly be required.
Optional Coverage in California
Since California does not require collision, comprehensive, uninsured/underinsured motorist or medical payments (first party injury), the person renting the vehicle may not carry those coverages on his or her personal vehicle. If this is the case, rental car insurance should definitely be considered, and at the very least a CDW.
Where to Find California Car Rental Insurance
If the rental vehicle is not covered under your automobile policy or you simply don’t have enough coverage, there are several options for obtaining rental insurance. Your insurance company may have separate policies you could purchase or endorsements you could add on to your policy. Also, the rental company will most often have insurance you can buy at the time of rental. However, California car rental insurance can also be found online with a quick search.
Because insurance laws are strictly regulated it is imperative that you understand exactly what insurance coverage you have before driving off the lot in a rental vehicle. Although rental lots are not required to ask you whether or not you have insurance, they will offer you insurance or CDW options when you sign the contract. To protect yourself against being held liable for costly losses, make sure you have the insurance you need.