Have you ever noticed how many different types of coverage plans are out there for your car insurance? I tend to look at car insurance and think “Alright, I have to get this, and it’s a good thing. So what’s the cheapest I can get that will take the best care of me.”

Great thought, really, but there are so many areas that insurance companies have thought of including coverage options that you might be overwhelmed with by the time you finish looking at your options.

The primary purpose of having car insurance is to make sure that we are taken care of if we get into an accident. One thoughtful coverage area that car insurance agencies have factored in as an optional coverage plan is car rental insurance.

Car rental insurance is available for anyone, but most helpful to those who don’t have eight cars sitting in their driveway (let alone two). You can’t tell me you haven’t seen driveways so full of cars that they’re just spilling into the road. Anyway, if you don’t have multiple cars available to you, car rental insurance is a great addition to your car insurance policy.

How Car Rental Insurance Works:

While your car is in the shop for repairs, you can use car rental insurance to cover the cost of your car rental. You car insurance company will probably have a list of approved rental companies or you can choose a rental company of your own.

If you choose to go the route of the approved rental company, you won’t see anything come out of your bank account as the car rental company can bill your car insurance company directly. If you choose to rent a car from a place that is not on that “approved list,” keep the receipts and send them to the insurance agency. The agency will then reimburse you the amount spent.

Car rental insurance usually has a per accident/per day limit. Your insurance company might give you $800 to spend over the entirety of your car rental time period and might limit your spending to $40 per day. If you can reduce the amount that you spend on your car rental, you can extend the “free” rental period for longer.

Car rental insurance is definitely not a requirement, but if you’ve got multiple people depending on one car, it’s a great way to make sure that you’ve got a backup plan that won’t let you down.