When you sign a rental agreement you agree to be responsible for damage to the car, regardless of how it happens.   When we rent cars, the rental agents asks if we would like to buy insurance in case the car is damaged.  My answer is always “no thank you.”

For a guy that has not had an accident in my own car for over twenty years, my record with rental cars is astoundingly bad!

The first “incident” occurred when I back my rented Peugeot into a tree in the French Alps… 9100 francs in damage ($1300 back then).

Then there was an incident on Houston Street and 7th Avenue in Manhattan, when my rental Saturn got creamed in an intersection accident. 

The most embarrassing crash was when I pulled in to return my rental car and hit a stanchion in the Geneva airport (700 Swiss Francs).

Oh, bad memories…I rear ended a sweet little old lady who stopped suddenly to make a turn in Tampa.  My mini-van (it was all they had left!) was darn near totaled.

Finally, last winter my rental Chevy was hit while parked in Naples, Florida.   A ding in the quarter panel that ended up costing over $3,000 to repair.

My out of pocket expense for all of these incidents was zero! 

In the European incidents I had used my American Express Gold Card for the rental cars.  One of the benefits of my Gold Card is that Amex pays for damage to rental cars.  Check with Amex or your other credit card company to see if your card has the same benefit.    

Gosh, that reminds me of the time my wife was a passenger in a rental car in Italy.  Her law partner rented the car with his credit card, believing that it included coverage for rental car damage.  The jet lagged driver fell asleep and went off the road, causing $5,000 of damage to the rented Mercedes Benz.  My wife was okay, but because they were on business, the credit card’s insurance benefit was invalid and the law firm had to pay for the damage out of pocket! 

Fortunately for us, New York State personal auto insurance policies include a "Rental Vehicle Coverage endorsement" that provides coverage for our rental “contractual liability.”  That is how my Florida and New York wrecked rentals got paid for. 

Remember, your auto insurance policy is effective only in the 50 states, Canada, US Territories and Possessions.  It is NOT effective in Mexico or Europe.  So, as long as your rental is in the U.S.A. or Canada, your New York Personal Auto Insurance policy covers your legal responsibility to the rental company for damage to the vehicle.

Some people purchase the Collision Damage Waiver from the rental company simply because they do not want to deal with any hassle when returning the car or maybe they just don’t want to put a claim in to their insurance company.   Personally, I never purchase the waiver… but, if it is really inexpensive or for a very short duration (a day or two), it might be worth considering.

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