Cheap Car Rental Terms and Charges

One reason that people hesitate to rent a car is because they do not understand the terms and charges outlined in the rental agreement. Since it is a legal document, it is important you know the types of charges that can accrue when you lease a vehicle. You can save money and have a better overall rental experience even with cheap car rental.

Collision Damage Waiver (CDW)

This should not be confused with collision insurance. When you purchase this waiver, the rental company accepts financial responsibility for any damages to the car during your rental term. If you decline to pay for the waiver, you must pay for any damage. Keep in mind this covers the vehicle only. The company accepts no financial responsibility, with or without the waiver, for injuries or personal items in the car. The company can void the collision coverage if you were engaged in behavior that is illegal or unallowable under the terms of the waiver. Typical charges for this optional waiver range between $10 and $15 per day.

Personal Accidental Insurance (PAI)

Rental companies may offer this insurance coverage to low-risk drivers. If you are involved in a car accident while driving the rental car, this coverage will pay for some of your medical expenses. A death benefit is also available. You can get this insurance for as little as $4 per day. There are car rental companies that offer it for as low as $1.50 per day but the coverage may not be on par with other policies.

Personal Effects Coverage (PEC)

If you are concerned about your personal belongings such as luggage or laptop, you can purchase this coverage. It pays for the current value of your personal items for about $1.25 per day. You may already have policies that cover your items such as travelers or homeowner's insurance.

Supplemental Liability Insurance (SLI)

For further protection, this insurance will pay for injuries and car damage to third parties if you cause an accident while driving the rental car. If you already have liability insurance through your auto insurance agency, you may not need to purchase this policy. Contact your insurance agent to find out if your current policy extends to rental cars.

Additional Charges

Your rental agreement will outline additional charges you may be responsible for including a deposit when you pick up the car, mileage fees for driving the car, and a charge to refuel the car when you return it. If you plan to have a second driver or a driver who is under age, you will be assessed additional fees. Driving the car from one state to another is an added cost which can be quite expensive. And do not forget to consider taxes which are based on the state and city of the rental company. Make sure you have a full understanding of your cheap car rental liability and charges before signing the rental agreement. If you are involved in an accident or other situation involving the rental car, you want to be protected as much as possible. There may be overlap between rental company policies and your own auto or health insurance. Contact your insurance agents if you have questions about coverage or liability.