Does your personal car insurance cover a rental car?
Often, in the United States, yes. Outside the US, its territories and Canada, usually no. Most personal auto policies written in the US do not cover a rental car driven abroad, so you would have no liability, collision, comprehensive or roadside cover unless a policy says otherwise. When your own policy does not apply, you need another source of cover for damage to the car and for theft of the car. That is most often a collision damage waiver from the rental supplier, a credit-card benefit, or collision cover within a travel insurance policy.
Cars Renta is a comparison site. Cover is sold by the rental supplier or by our booking partner DiscoverCars, and the terms are set by them. We do not sell insurance, and we cannot change or cancel a booking.
What does your own policy cover abroad?
According to Allstate's guidance on international rentals, most US personal auto policies give no protection while you drive a rental outside the US, its territories or Canada. That means:
- No liability cover
- No collision cover
- No comprehensive cover
- No roadside assistance
Some policies offer very limited protection in certain countries, but Allstate describes this as the exception. Check with your insurer well before you travel.
The position differs by neighbour:
- Canada: Most US policies extend to your insured vehicle for short personal trips, but you should notify your insurer before crossing the border. The sources do not say whether this extends to a rental car.
- Mexico: US coverage does not apply. You need Mexico-specific auto insurance from an insurer.
What is a collision damage waiver, and what does it cover?
A collision damage waiver (CDW), also called a loss damage waiver (LDW) by some firms, is the rental company's option to limit what you pay for damage to the car. Rick Steves notes that it is technically a waiver, not insurance. The company gives up its right to collect the full deductible (the amount you pay before cover applies) if the car is damaged. It reduces the deductible rather than removing it.
Two exclusions matter. A basic CDW usually leaves out the undercarriage, roof, tyres, windscreen, windows, interior and side mirrors, according to the same source. Theft cover, where included, covers the car itself, not items stolen from inside it.
What does it cost?
| Cover | Typical published cost | Typical excess you still pay |
|---|---|---|
| Basic CDW from the rental company | About $15–30 a day | About $1,000–1,500, or more for some car types |
| Super CDW (zero-deductible) added on top | About $10–30 a day more | Reduced to zero or near zero |
| Inclusive "basic" rate with CDW built in | Included in the rate | Often $2,000–3,000 unless you also buy super CDW |
These figures come from the Rick Steves page. Prices change, so confirm the current figures in your booking.
Rick Steves warns that an inclusive rate that looks cheap often carries a high deductible, so you may end up paying for super CDW anyway.
When do you need the rental company's cover instead?
You are more likely to need the rental company's collision and theft cover in these situations:
- Ireland or Italy. Several sources say credit-card cover is often excluded here. Allstate adds that Italy and Ireland often require CDW even if you have card cover. Rick Steves says you will have little choice but to buy the company's CDW.
- The rental country requires it. Allstate says some countries legally require CDW and liability cover and include them by default. Coverage limits may still be low, so review them.
- Your card does not meet the conditions. If the country, car type or rental length falls outside the card's terms, the card will not cover you (see the next section).
- Long rentals. Rick Steves suggests that if you need a car for at least three weeks, leasing may be better, because leases include zero-deductible collision and theft cover. Check the terms of any lease carefully.
- Your card's limit is below the car's value. Rick Steves notes that if the maximum reimbursement is less than the car's price, the rental company may require its own CDW.
Liability cover is a separate question. Rick Steves says a basic European rate almost always includes liability for damage to other people and property, and that extra liability cover is rarely needed. Allstate recommends asking whether liability is included or separate before you drive.
How does a credit-card rental benefit work?
Many travel and premium cards include rental car cover, often worldwide. It is usually free, but it has strict conditions. Allstate and Rick Steves agree on the main points:
- Check the card's terms first. Confirm which countries are covered, which vehicles are excluded (luxury, antique, exotic and large cars are often out), whether theft and loss are covered, and whether windscreens and tyres are excluded.
- Pay with the same card you booked with. Switching cards can invalidate the cover.
- Decline the rental company's CDW. If you accept any cover from the rental company, you forfeit the card's cover. For example, if you accept a CDW with a $1,000 deductible, the card will not cover that deductible.
- Expect a hold. Declining CDW may mean the company places a hold on your card for the full value of the car. You need enough available credit for that.
- Ask for a Letter of Coverage. Rick Steves suggests bringing a printed copy to the rental counter in Europe.
Two more points are worth knowing:
- Primary or secondary. Allstate notes that some cards are primary, so you do not need to involve your own insurer. Others are secondary and only cover what your insurer does not.
- Length of rental. The sources differ. Rick Steves says coverage is often capped after about 30 days, and if your rental exceeds that, the card covers none of it. Allstate says rental periods typically must be under 15 to 30 days. Check your card's specific limit.
What happens if you have an accident abroad?
Allstate lists these steps:
- Call local emergency services if needed.
- Contact the rental company immediately.
- Document the scene with photos, names, licence plates and any police reports.
- Notify your credit-card company or insurer if you are using their cover.
Allstate warns that claims can be delayed and that you may face out-of-pocket charges while the incident is investigated.
If you pay through a card, Rick Steves explains that the rental company charges your card for the damage, up to the deductible. You then claim the money back from the card issuer after you return home. You will need the police report and the rental company's accident report. He adds that American rental companies can be easier to deal with when you have a claim.
What should you check before you rent?
Ask the rental supplier and your insurer these questions before you drive:
- Is my US policy valid in this country?
- What coverage is included in the rate?
- What am I responsible for in an accident?
- Is liability included or separate?
- Do I need an International Driving Permit?
Allstate also notes that credit cards and rental insurance typically do not cover two-wheeled vehicles.
Confirm your cover in writing before you pick up the car, whether it comes from a card, a travel policy or the rental company. Terms, excesses and prices change, so check them on the day you book. You can compare current offers on the booking search page, and read how rental pricing works before you decide.
