What is Rental Car Insurance?

If you’ve ever rented a car, you’ll probably recall being asked if you wanted to purchase rental car insurance. But considering it isn’t mandatory coverage, do you really need to buy it? Well, rental car insurance is coverage specifically for rented vehicles. It provides financial protection in the case of accidents, theft, or damage – and you might already have it. To avoid purchasing additional coverage you may not need, you’ll want to check if you’re covered for a rental car prior to picking it up, or even better, prior to booking the car. But how do you know if you’re covered? And should you consider purchasing insurance via the rental agency? We’ll cover some questions you may have so you can drive off the lot with confidence.

Do I need rental car insurance?

Yes, it’s highly recommended to have insurance for a rental car. Having the right coverage in place may prevent you from paying out of pocket to cover the cost of loss or damage to your rental vehicle. However, you don’t necessarily need to take the insurance offered by the rental car company to have coverage. In fact, rental car insurance may already be included in your existing insurance policy. Many credit cards also offer some level of insurance protection for rental vehicles. Of course, we still suggest taking the time to review each of your rental car insurance options to ensure you have the coverage you need. Coverage from the rental car company, coverage provided as an optional add-on to your insurance, and coverage available as credit card benefit may not overlap and could include different risks and policy limits.

Does my existing insurance cover a rental car?

Yes, if you have the Grand Touring Solution® or a TD Insurance home insurance policy with Umbrella coverage, insurance for loss or damage to a rental car is included under those endorsements, up to coverage limits.

  • Grand Touring Solution®: If you have a car insurance policy with TD Insurance, you may be eligible to purchase the Grand Touring Solution® add-on which offers the greatest level of car insurance coverage. With the Grand Touring Solution®, you and anybody insured on your policy will be covered for damages when driving within Canada or the U.S. Conditions apply. Ask a TD Insurance agent for details.
  • Umbrella coverage: If you have an existing TD Insurance home insurance policy with Personal Umbrella coverage as an add-on, it’ll provide coverage when driving a rental vehicle outside of Canada and the U.S. under certain conditions.

It’s best to check your car and home insurance policies ahead of time to verify your coverage should something happen on your trip. If you’re a TD Insurance customer, you can review your policy details through MyInsurance or the TD Insurance app at any time.

If you’d like to update your policy to include rental car coverage and more, you can manage your policy online, or contact us to help adjust your coverage.

Will my credit card cover me?

There are many credit cards on the market that offer benefits which may include some level of protection for a rental car. Because each card (and card company) offers different coverages, it's important to first review your cardholder agreement or reach out to your credit card company to ensure you have enough coverage.

Keep in mind that with most credit card companies, there are certain conditions that must be met for coverage to be active. For example, in order for coverage to apply, some credit card companies may require you to charge the cost of the rental vehicle to your credit card. And, with your credit card's coverage, although most vehicles are covered, there are some exceptions. Make sure you check your credit card policy for further details or reach out to your credit card company for further information.

When should I consider the rental insurance option made at a car rental agency?

You may want to consider purchasing coverage via the car rental agency if you:

  • don’t have the applicable coverage through your car insurance policy, or
  • you don’t have enough coverage through your credit card.

Car rental agencies typically offer a Damage Waiver that covers damage to the rental car, but doesn’t include damage to third party property or people. They can also offer Personal Accident Insurance which provides the renter and their passengers with some level of accident benefits. Although not mandatory, having some degree of coverage may prevent you from paying out of pocket should anything happen to you or your rental.

Overall, do I need to purchase rental car insurance?

While we strongly recommend having insurance for your rental car, you may not need to purchase additional insurance to get it. Depending on your existing insurance coverage – and even the credit card you use – rental car insurance may already be included. However, keep in mind that not all rental car insurance is created equal, and the covered risks and policy limits can vary greatly between what’s included under your existing car insurance policy, what can be purchased through the rental agency, and what’s available as an embedded credit card benefit. When deciding whether you need to purchase rental car insurance, review your options to ensure you have appropriate coverage. If you’re an existing TD Insurance customer, you can check your coverage by logging into MyInsurance. While signed in, chat online with a TD Insurance Advisor to help determine if your current coverage meets your needs.

If you’re looking to purchase a car insurance policy with us, click the link below to get a quote online in minutes.

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The content on this page is for general information purposes only and does not constitute legal advice. Coverages described herein may be subject to additional eligibility criteria, limitations and exclusions. In the event you make a claim, potential indemnification is also subject to the receivability of the claim and the type of coverage you bought.

In the case of conflict between the content on this page and your policy wordings, your policy wordings shall take precedence. Please speak to an Advisor or consult your policy wordings for further details.