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Renting a Car

Many people need to rent a car from time to time, whether to get around on vacation or while a vehicle is in the shop for repairs. At your next car rental, consider the following:

Only Buy Optional Coverage Products You Need.

The cost of optional coverage products sold by car rental companies can significantly increase the cost of a car rental, sometimes by $30 or more per day.

The four main types of optional coverage products offered by car rental companies are: (1) collision damage waivers, which reduce or eliminate your liability for damage to the rental car; (2) supplemental liability protection, which provides coverage (sometimes secondary) in the event of an accident; (3) personal accident insurance, which provides coverage for emergency medical expenses and death benefits; and (4) personal effects coverage, which provides coverage for theft of personal effects. All of these products are optional.

Under Minnesota law, all auto insurance policies must cover against damage to a rental vehicle and loss of use of the vehicle, and extend the policy’s basic economic loss benefits, residual liability insurance, and uninsured and underinsured motorist coverage to the use of the rental vehicle. This means that if you own a car and have car insurance, your rental car will be covered too.

State law prohibits car rental companies from selling collision damage waivers or other insurance products unless the renter acknowledges that they have read and understood a disclosure stating that a personal auto insurance policy must cover the rental of the vehicle and that purchasing these types of additional coverage is unnecessary.

Your rental car may also be covered by your credit card company.

While there may be reasons to buy optional coverage products—such as if you are renting in a foreign country or want coverage for liability that exceeds the amount provided by your personal auto insurance policy—the decision to do so should be one you knowingly, not unwittingly, make. (Your personal auto insurance policy may not cover cars rented in another country.) You should check with your insurance company to determine the scope of your coverage before you rent a car. Also, if you pay by credit card, check if your credit card company provides coverage.

Inspect the Car Before You Leave the Lot.

Car rental companies hold the renter responsible for the safe return of the rental vehicle. Aside from normal wear and tear, they expect the rental vehicle to be returned in the same condition as when it was rented. If an accident or other damage occurs, the rental company will hold you liable for repairs—even if it wasn’t your fault. Even small scratches can lead to charges costing hundreds of dollars.

Before you leave the lot, you should inspect the car and make sure any existing damage has been recorded by the rental company. To protect yourself, you may also want to take pictures of the entire car. While this takes time, having your own record of the vehicle’s condition before and after the rental could save you even more time and money down the road.

Beware of Additional Costs.

Besides the basic rental charge, you may have to pay several extra fees when renting a car. Some of these fees may be buried in the small print of your rental contract. To avoid an expensive surprise when you return the car, ask the rental company about fees before you rent the car and read your rental contract carefully. Some common fees include:

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