One question that often comes up when renting a car is whether you need to buy rental car insurance. Rental car insurance can add a lot to the cost of your rental, but is it really worth it? Here are some things you should know:
People with personal auto insurance are covered for rental cars, even if they don’t have collision or comprehensive coverage.
New York Rental Car Insurance Law: Everything You Need To Know
Having the right insurance coverage is crucial when renting a car in New York. The state has specific laws regarding liability limits and who pays for damage to rental vehicles. As a renter, you could be on the hook for thousands of dollars if you don’t understand your responsibilities.
This guide will explain New York rental car insurance requirements, coverages, exclusions, and steps to take to protect yourself financially. We’ll also answer some frequently asked questions about renting and insuring rental cars in NY.
New York Rental Car Insurance RequirementsNew York law requires rental car companies to provide minimum liability coverage to drivers This includes
- $25,000 bodily injury liability per person
- $50,000 bodily injury liability per accident
- $10,000 property damage liability
This coverage protects against claims if you injure another driver, passengers, or a pedestrian. It also covers damage you cause to other vehicles or property in an accident.
However liability insurance does NOT cover any damage to the rental vehicle itself. Renters can be held fully responsible for costs related to theft vandalism, collision damage, or any other loss involving the rental car.
Prior to 2003, renters in NY were only responsible for up to $100 worth of damage under state law. But that cap has been removed. Now, rental companies can charge you the full cost of repairs no matter how high.
Without protection, you could end up with a multi-thousand dollar bill if you damage the rental That’s why it’s essential to understand your options
Coverage Options for Damage to the Rental Car
Luckily, New York drivers have several ways to protect themselves against financial liability for rental car damage. These include:
Personal Car Insurance – Most NY auto insurance policies automatically include rental car coverage thanks to a state law requiring this protection on policies covering private passenger vehicles. Check your policy documents to confirm.
Credit Cards – Many credit cards provide rental car coverage when you use the card to book and pay for the rental. However, the coverage and benefit limits vary widely by issuer. Review your cardholder agreement for details.
Rental Company Insurance – You can also purchase optional loss/collision damage waiver coverage directly from the rental car company. This relieves you of responsibility for damage to the rental, but is an extra cost.
Rental Reimbursement Coverage – A standard add-on to many car insurance policies. It provides reimbursement for rental costs while your personal vehicle is in the shop for covered repairs. But does NOT cover damage to the rental car itself.
Steps to Protect Yourself in NY
To make sure you have sufficient coverage when renting a car in New York, follow these best practices:
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Review your personal auto policy to confirm rental car coverage is included. This is primary protection in NY thanks to state law.
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Pay with a credit card that offers rental car coverage as an extra layer of protection in case of gaps.
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Consider purchasing the rental company’s optional collision damage waiver if your personal policy and credit card together don’t provide adequate coverage.
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Take cell phone photos showing any prior damage before driving the rental vehicle.
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Read rental agreements closely and decline any unnecessary or duplicative coverages. For example, you may already have personal injury protection under your own policy.
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Use a major credit card that provides primary rental coverage if you don’t have your own car insurance.
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Report any rental car damage immediately to the agency and your insurer or credit card company. There are often short timeframes to file claims.
What’s Covered and Exclusions
Rental car coverage protects against damage to the rental vehicle itself. This includes:
- Collision, upset, or rollover
- Vandalism or theft
- Windshield cracks, glass damage
- Tire or wheel damage
- Interior stains or spills
- Loss of accessories like toll passes or GPS devices
However, damage caused by excluded drivers would not be covered. For example, your friend Dave would not be covered if he has an accident driving the rental car but is not named on the agreement.
Other common exclusions include:
- Driving on prohibited roads or off-road
- Using the rental vehicle for commercial purposes like delivering food
- Violating the rental agreement terms and conditions
Normal wear and tear is also generally excluded. Make sure to note any prior damage on the rental agreement before taking possession of the vehicle.
In addition, liability insurance never covers damage to the rental itself – only injury and property damage caused to others.
Steps if You Damage a Rental Car in NY
If you damage a rental vehicle in New York, here are important steps to take:
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Move to a safe location if the car is disabled and call for assistance.
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Report the incident to the police and obtain a copy of the accident report.
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Take photos documenting the damage, overall scene, and injuries/property damage if it is safe to do so.
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Notify the rental agency immediately. Provide your name, rental agreement number, and details on what happened.
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Note the time and date you reported the damage to the rental company. Follow up in writing if possible.
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Contact your own insurer or credit card company as soon as possible to file a claim if you purchased coverage through them. There are often short timeframes to report, frequently just 30 days.
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Obtain a copy of the repair estimate from the rental company and review for accuracy and reasonableness.
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Consider asking your insurer for an independent appraisal of the damage if the rental agency’s quote appears inflated.
Following proper procedures can help resolve claims as quickly as possible while minimizing your out-of-pocket costs.
Frequently Asked Questions
Below are answers to some common questions about renting and insuring cars in NY:
Q: Can rental car companies charge more than $100 for damage in New York?
A: Yes, the previous $100 damage cap in NY was removed. Rental agencies can now charge you the full cost of repairs regardless of amount.
Q: Does my NY auto insurance automatically include rental car coverage?
A: If your personal policy covers fewer than five vehicles registered to an individual or married couple, rental car coverage must be included. But check your policy documents to confirm.
Q: What if I don’t have my own car insurance in NY?
A: Purchase liability and collision coverage directly from the rental company for protection. Otherwise you are fully responsible for any damages or injuries to others.
Q: Does rental reimbursement coverage pay for damage to the rental car itself?
A: No. Rental reimbursement only covers the cost of renting a replacement vehicle while your personal car is being repaired after a covered loss.
Q: Can I be reimbursed for a rental if my car is stolen in NY?
A: Yes, if you have rental reimbursement coverage on your auto policy, it will pay for a rental for a certain timeframe while your vehicle is stolen and recovered.
The Bottom Line
Understanding New York’s rental car insurance laws is key to getting adequate protection. Make sure to review your options and confirm you have sufficient coverage through your personal policy, credit card, or the rental company’s offerings. This can help avoid major out-of-pocket costs if you damage the vehicle. With the proper coverage, you can rent worry-free in NY.
Check Your Policy For Details
Here are the key features and details of the Rental Vehicle Coverage Endorsement that your policy will address:
- Damage Coverage for Rental Cars: The Rental Vehicle Coverage Endorsement usually pays for damage to a rental car that happens in an accident, theft, or vandalism. It might also cover the fees the rental car company charges for not being able to use the car while it is being fixed or replaced.
- Things that aren’t covered: Make sure you read the endorsement’s fine print. Some restrictions and exclusions may apply, such as coverage limits for certain types of rental cars, the length of the rental period, or certain areas of the world.
Understanding the NYS Rental Vehicle Coverage Endorsement
Section 3440 of the New York State Insurance Law addresses the Rental Vehicle Coverage Endorsement, which provides additional coverage for rental vehicles and is designed to protect policyholders who rent cars when their personal auto insurance policy doesn’t fully cover such rentals.
Section 3440 of the New York State Insurance Law:
(b) Except for (d) of this section, every motor vehicle liability insurance policy that covers less than five private passenger motor vehicles registered in this state must include an endorsement that covers the insured for actual damage to or loss of vehicles rented by an insured in the United States, its territories or possessions, and Canada under a rental agreement with a term of thirty days or less, no matter where in those areas the rental vehicle is registered, rented, or operated. This is subject to the maximum coverage limits that the superintendent may set by regulation or any other applicable limits in the policy, whichever is higher.
Should I Buy Additional Insurance From a Rental Car Company?
FAQ
Do I need insurance to rent a car in NY?
Who pays for rental car after accident in New York?
Do you need extra insurance when renting a car in USA?
Is car insurance required in NY?
Can a rental vehicle company sell collision damage waivers in New York?
New York State Law formerly prohibited a rental vehicle company from selling Collision Damage Waivers (CDWs) in New York on motor vehicle rentals of 30 days or less. A rental vehicle company was not, in most circumstances, able to hold renters liable for more than $100 in the event the rental vehicle was stolen or damaged.
How much does car rental insurance cost in New York?
Also known as Liability Insurance Supplement (LIS) or Supplemental Liability Insurance (SLI). For a fee of approximately $10.95 per day, the car rental company will supplement the liability insurance that the company must, by New York law, provide.
How much is a car rental death benefit in New York?
Typically the death benefit is $175,000 for the renter and $17,500 for the passenger. Many of these benefits duplicate coverage you may already have under your health, life, or automobile insurance policies, or duplicate coverage that the car rental company must provide under New York’s No Fault law.
Do you need car insurance if you rent a car?
Each coverage protects against a different risk, but your car, home, life, or health insurance policies, or your credit card, may provide all or part of the protection you need, particularly when combined with the minimum insurance the car rental company is required by law to provide as a part of every rental.