Planning to rent a car? Whether it’s for a vacation or a temporary replacement vehicle, understanding rental car insurance is key to avoiding costly surprises. One of the most misunderstood areas in personal auto policies is how they apply to rental vehicles—especially when someone other than the named insured is doing the renting.
1. Does Your Personal Auto Policy Cover Rental Cars?
Yes—but only if you’re the named insured.
If you rent the vehicle and you’re listed as the named insured on your policy, most standard auto policies will extend:
- Liability coverage
- Comprehensive and collision coverage (if included in your policy)
However, this coverage does not extend to family members or children listed as drivers on your policy if they are the ones renting the car.
2. What Happens If a Household Member Rents a Car?
If your child or another household member who is only listed as a driver on your policy (and not the policyholder) rents a car, they typically won’t have physical damage coverage under your insurance.
In this case, they should:
- Purchase the rental company’s insurance coverage
- Consider getting their own separate auto policy if they rent vehicles regularly
More details on this issue can be found in FMNE’s rental car guide.
3. Should You Buy the Rental Company’s Coverage?
Sometimes, it’s a smart move to say “yes” to the extra coverage. You may want to purchase:
- Collision Damage Waiver (CDW) – Covers damage to the rental vehicle
- Liability Coverage – If you don’t have sufficient coverage already
- Personal Accident Insurance – Covers medical costs for you and your passengers
- Personal Effects Coverage – Protects your belongings inside the rental
4. Avoid These Common Mistakes
- Assuming your auto policy covers anyone in your household renting a car
- Not confirming coverage with your insurance agent ahead of time
- Declining rental coverage without knowing what’s excluded
- Failing to check if your credit card offers rental protection (some do)
Conclusion
Rental car insurance can be confusing—but the risk of assuming you’re covered when you’re not is far too costly. If you or a family member is planning to rent a vehicle, double-check your policy or talk with your insurance provider to ensure you’re fully protected.Need help confirming your coverage? Contact Nebraska’s Insurance before you hit the road.