When you are out of town either for business or pleasure, renting a car is always helpful. However, accidents happen even if you are on a vacation—or driving a rental vehicle. Who pays for collision repair costs of rental vehicles? It depends. When renting a car, you have three options for covering the risk of damage: availing a collision damage waiver (CDW) from the car rental company itself, using your credit card's coverage, or including collision insurance in your travel insurance policy.
Collision Damage Waiver
Collision damage waiver (CDW) is often included as an add-on to the total rental fee. This waiver serves as a protection for the renter in case of a collision. If you avail the CDW, you will not pay for the collision repair costs. However, CDW tends to be expensive, ranging from $10 to $30 per day. Yet, some CDWs tend to exclude major collision repairs. So, you still have to pay for more extras in case of major damages.
Credit Card or Car Insurance Policy
Some credit cards and car insurance policy offer coverage for damaged rental vehicles. Most credit cards offered today include collision coverage even for rentals. Your own car insurance policy may also include rental car under liability and accidents. Check with your own car insurance provider before declining CDW. In either option, a certain amount of collision repair fees are payable by your insurance providers. You may still have to shell out the amount for collision repair fees to be reimbursed later on. Be sure to use the credit card itself when paying for the rental for the coverage to take place.
Travel Insurance Policy
Aside from accident and life insurance, you can also avail for rental car insurance policy from your travel agent. Their fees are usually cheaper because of their partnership with car rental companies. The travel agency will pay for the collision repair fees. The policy is refundable if you avail the car rental company's CDW.
Either using your own car or a rental, try to minimize the risk by availing CDW from your car rental company or collision insurance from your travel agent. Some credit cards also offer the same policy. Collision repair fees tend to be expensive. You can use these insurance policies to avoid paying for costly collision repair fees. Yet, of course, nothing beats driving safely whether you are driving your own car or a rental. On top of that, choosing affordable and quality collision repair in your area will help mitigate your costs without compromising the quality of your repairs.