I’m renting a car while on vacation; do I need to buy the rental company’s insurance?
February 3, 2011
This is one of the most common questions I get asked on a weekly basis. Here is what you need to know.
Most people look at their insurance papers and see “OPCF 20 – Rental car coverage” and assume this is what they need when they go on vacation and rent a car. This is not true.
OPCF 20 – “Rental car coverage” covers you if you need a rental car after a claim, not if you are going on vacation and renting a car. OPCF 20 says that if you have an at-fault accident, not-at fault accident or your car is stolen, we will hook you up with a rental car right away so you’re not stuck without a car after a claim.
The coverage that you are looking for when you go on vacation and rent a car is called OPCF 27 – “Damage to non-owned vehicles”. This coverage does not come standard on any auto insurance policy and you must ask for it to be put on.
When you rent a car, there are three things that must be covered for your own protection and the protection of the company that is renting you the car:
- Third-party liability
- Accident benefits
- Damage to vehicle
You have two options for purchasing the coverage needed:
- Take the insurance offered by the rental company (usually $10-$15/day)
- Add OPCF 27 to your auto policy for $30-$50/year (depending on the company). This will cover you year round for any rental car you rent for any reason.
Things you need to know when driving a rental car:
- Your insurance only covers you in Canada and the continental US
- You must have physical damage coverage on your auto policy to qualify for OPCF 27
- Every driver of the rental car must have OPCF 27 on their own policy in order to drive the rented car.
- Example: You and a friend go on vacation together. Back home you both have your own cars and both have separate insurance policies for your cars. On vacation you share a rental car. You BOTH must add OPCF 27 to your own insurance policies back home before driving the rental car. If only one of you has it added to their policy, only that person is covered when driving the rented car.
If you ever have any questions regarding renting a car, contact me.
Addition: some credit cards offer the same coverage that OPCF 27 offers. here is an example http://www.tdcanadatrust.com/tdvisa/features.jsp#1
ICD Insurance Brokers Ltd. and I offer our clients a small business mentality backed up by the security of a corporate insurance company. Providing house calls within The GTA is my specialty. Whether you are looking for home, auto or business insurance, I will do my best to provide the coverage you need at the lowest possible costs.