Can I rent a car without insurance?

Although you cannot rent a car without insurance, your car insurance should cover rental cars. Be sure to check your policy or call your provider to ensure you are covered before cancelling rental insurance. If you get a car rental without insurance, you must purchase coverage from the rental company.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

UPDATED: May 20, 2022

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Here's what you need to know...

  • If you have personal auto insurance, your policy will cover a rental car in the U.S.
  • If you do not have coverage or believe you will need additional coverage, check with the agent at the car rental company to discuss options
  • Liability-only policies often will not be enough to safely cover your rental

Are you wondering “Do I need insurance to rent a car? Rental cars automatically are insured by the company for the minimum liability requirements of the state. So, when you rent a car, it is insured and you won’t get into legal trouble if you don’t have a policy of your own.

Supplemental insurance rates are negotiable and something that should be considered because the state minimum requirements don’t provide adequate protection should you cause a major accident. If you do not own your own vehicle, and you are tempted not to take on the costs of buying specialized insurance, read this guide to insuring rental cars for all of the pertinent information that you need to know.

Can you rent a car without insurance?

Do you need insurance to rent a car? You can rent a car without auto insurance. When you rent a car, the minimum liability coverage is automatically provided. You can get a higher level of coverage to make sure you won’t be paying for damages out of pocket.

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Why are renters not legally bound to buy insurance?

Thinking of renting a car without insurance? Well, you are required by law in most states to insure all vehicles that you own so the rental company has to carry the minimum required coverage.

Since rental car companies will have the vehicle insured, you won’t get a ticket for driving without a rental auto insurance policy.

While you cannot be cited, you can still face a civil lawsuit for causing third-party damages or injuries when you do not have enough liability coverage to pay for property damage or bodily injury expenses.

Do you need car insurance to rent a car?

Almost every state requires a policy with liability coverage, but typically, the required amount is not enough to pay for damages you inflict on others in a major crash. You will be responsible for the balance of what the insurer pays and the cost of the damage. Also, keep in mind, liability coverage (the kind of protection that is automatically on the rental vehicle) does not cover damage to the rental vehicle itself. If you total the car, you will be liable for the replacement cost out of pocket.

If you are negligent for the injuries, third-party damages, or the damage to the rental, you may be ordered to pay by liquidating your assets or by having your wages garnished. To truly protect yourself financially, consider the following three ways in which you can be sure you have adequate rental coverage.

Will your personal auto insurance policy transfer to the rental?

Do you have to have insurance to rent a car? Some might not even be aware that their private passenger auto policy will extend to cover them while they are driving a rental in the United States.

You need to be sure to check with your personal auto insurance provider to learn exactly how your coverage extends, but it’s nice to know that the liability coverage from your personal insurance policy will follow you as the driver.

Let’s see how your personal coverage can protect you.

What is liability insurance?

When you own a car and live in a state where personal car insurance is a requirement, you will have at least a minimum amount of liability coverage.

Liability coverage will pay third-party expenses for:

  • Medical treatments
  • Emergency transport
  • Loss of wages
  • Repairs or replacements when you are negligent for a collision

When you review your policy, you will see that the liability coverage will follow you to provide protection if you are borrowing a car or renting a replacement. You should always check with your agent to see if you need to notify the insurer before you rent.

There are also other considerations to make. Be sure to check your limits and consider raising them. It’s better to have extra insurance you don’t need than to not have enough coverage when something happens.

When you are driving on unfamiliar terrain, the risk of having a loss is higher.

On many occasions, however, insurers will raise your limits automatically to match state requirements if yours are too low.

What is physical damage coverage?

Physical damage coverage will help to pay for repairs and car replacement of the covered vehicle when you experience a covered loss. It is made up of comprehensive and collision coverage. Collision losses involve crashing into an object. Comprehensive coverage will pay for losses that do not involve a collision.

Some examples include:

  • Fire
  • Theft
  • Vandalism
  • Explosion
  • Glass breakage

Not all auto policies have physical damage coverage in case of an accident. You should review your personal policy closely to see if you have both comprehensive and collision coverage to cover an accident. If you do, you will be happy to hear that your coverage for physical damage will transfer to the rental car. It is defined under the policy as a replacement vehicle.

Whatever deductible that you carry on your policy will apply when filing a claim for your rental.

If you do not have auto coverage or you do not have full coverage on any vehicle, damage to your rental will not be covered unless you buy a supplemental plan.

Some policies also offer rental reimbursement coverage, which pays for a rental car if you’re own car is damaged and out of commission in a repair shop. However, this coverage usually does not apply to vehicles you’ve rented for vacation, a business trip, or other reasons that don’t involve your own car being damaged. Rental car reimbursement is an optional coverage, so it would not be on your policy unless you asked for it.

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Will your credit card offer protection?

Many credit cards include insurance coverage for rental vehicles. These companies include Visa, American Express, Mastercard, and Discover. The level and type of coverage will vary as well as coverage limits, but it’s worth looking into. Once you figure out which of your cards will provide the best complimentary coverage, you must make sure you do the following:

  • purchase the rental with that card
  • refuse supplemental insurance from the rental company

Keep in mind that certain vehicles aren’t covered by credit card companies’ policies. Find out if your vehicle type is excluded from your credit card insurance before making your decision.

Should you get non-owner car insurance or travel insurance?

Non-owner car insurance is a type of insurance that covers you when you’re driving a car that isn’t yours. So, non-owner insurance would cover you while driving a rental car, but it is a whole separate insurance policy, so it probably wouldn’t make sense to buy it unless you rent cars frequently and/or drive cars that belong to other people (and you also do not own your own car).

If you’re going on a trip and you’ve bought or are planning to buy travel insurance, that policy may offer coverage for rental cars. Check the details of the policy or ask an insurance agent if you will be covered.

Will the rental agency offer supplemental coverage options?

All consumers who have rented a vehicle know when they’re at the rental car counter that the agents are going to push rental car insurance. While the secondary coverage can sound enticing, most believe it just comes down to collecting more money.

Now that you know how your personal car insurance policy works, you can decide if you need to purchase their rental car insurance coverage. There are several types of rental car coverage peddled at the counter. Knowing how one differs from the other is crucial to cross the duplicates off the list and select the ones that will give you peace of mind.

Here is a breakdown of each:

Rental Car Insurance Options
Rental Car Insurance CoverageProtection Provided
Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW)The CDW is a damage waiver that will pay for all of the repairs to a rental car when it is damaged or stolen. The loss must happen when an authorized driver is operating the car and during the period when the waiver is valid.
Personal Accident InsuranceThis coverage pays for emergency medical transport and medical benefits if the renter or their passengers are injured in an accident.
Supplemental Liability ProtectionCar insurers are required to provide a limited amount of liability cover, but you can buy a supplemental amount of liability protection that covers you if you are sued. Anything that is carried by the rental agency is there to protect them and not necessarily you.
Personal Effects CoverageYou most likely will travel with valuable items. If you lose something of value, Personal Effects Coverage will pay to replace up to $500 of your valuables per person. Make sure you know how your property insurance works first.
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