“Driver Only Car Insurance”

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Photo by PoPville flickr user brunofish

“I have lived in the city without owning a car, but I do rent on occasion. I tend to buy the expensive liability insurance from the rental agency (since different credit cards offer primary damage insurance), but I’d love to find something I could get outside of the rental agency. Does this exist? ”

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50 Comment

  • HaileUnlikely

    I looked into this several years ago. It does exist. Not all insurers offer it. Those who do will likely call it a “non-owner policy” or something to that effect. Unless the rates have come down a lot, you’d have to do a whole lot of renting to make this worth it relative to just paying for the supplemental liability insurance when you rent.

  • Some credit card companies offer this as a benefit. Check with yours.

    • In my experience, even the premium AMEX added insurance does not cover liability.

      • But they cover half. Whatever it is – don’t know names – but they cover one of two types, so cuts cost by about half.

      • Not true at all, my AMEX covers liability and I use it all the time. You need to make sure you have the proper Platinum card, not the Optima. Also, note, that the booking has to be made on the card. Otherwise it’s pretty comprehensive.

      • Citibank Diamond card covers up to $50,000 liability for rental cars.

        • HaileUnlikely

          Liability for damage to the rental car, more commonly known as “collision insurance.” Bodily injury liability, i.e., liability for injuries that you cause to others, 1.) is something else entirely, and 2.) something that $50K won’t come close to covering if you are involved in a crash that results in another person being hospitalized.

  • I have a NNO policy from Geico – $300 per year. Getting this kind of policy is a pain because you have to call each insurer and usually get transferred around because it’s a niche product and a lot of people don’t even realize their company offers.

    The break-even point for rental cars is about 20 rental days per year. I was sold when I learned you can use it to file a uninsured/underinsured motorist claim even as a pedestrian/cyclist should the need arise. It’s pretty silly that if you go “car free” the only way to properly cover yourself is to continue carrying auto insurance, but that’s the world we live in.

    • Second this comment. I also carried a NNO policy from Geico for about the same price (+/- $50/year) to cover me and my then fiancee. We each kept a copy of the insurance card in our wallets so we always had it when driving the rental car (as opposed to leaving the insurance card in your owned vehicle as people typically do).

    • HaileUnlikely

      This is helpful, thanks. The rates were considerably higher last time I checked. At this rate I’d actually think about it.

    • I would have gotten twice the amount of damages for my crash if I had underinsurance so this is so good to know – its been on the list for a while. Especially with Maryland only requiring a minimum of $50k of insurance for drivers, having under/uninsured motorist insurance is a really good call.

  • Agree with the other posters. I looked into it several years ago and it was too expensive to make it worthwhile for me. Easier and cheaper to get a zipcar (which has insurance) or just pay more for the rental insurance.

  • It is “Non-Owner Policy”. It’s not the cheapest thing in the world; I have State Farm, for which I pay $260 every six months. (There may be something cheaper out there; I haven’t shopped around in awhile.) It covers liability, medical, etc., but not the vehicle. For that, you’ll still need to get insurance from the rental agency or from another source (i.e., credit card). But beyond just rentals, it’s good to have if you borrow a friend’s car frequently. Their car would be covered by their insurance, but you are not covered for liability, etc. Having your own insurance is still a good idea.

  • Thing is in almost all states the car rental company is on the hook for state minimum liability since the car is what is insured not the driver , if your credit card has a damage wavier that will cover damage to the rental vehicle. While most credit card cdw are listed as secondary that becomes moot if you don’t have primary insurance.

    • HaileUnlikely

      The state-mandated minimum liability coverage is so low in most states that if you are involved in a crash that results in injuries to others and are found at fault and have only the state minimum liability coverage, it will be a very expensive learning experience in how insurance works and how much medical care costs.

  • Paying the rental car companies for their coverage is just silly. Get yourself a decent credit card. Chase Sapphire is an excellent card even apart from their primary rental car coverage. I also understand that United MileagePlus® Explorer Card also provides excellent primary coverage… And if you aren’t eligible or don’t want to get another card, you can always reserve your rentals through carrentals.com and you will have a third-party offer for insurance coverage for between $9-$11/day, which beats what Hertz or Enterprise will try to gouge you with. Also, Carrentals.com and priceline are superior to Kayak for finding good auto rental rates. And certainly don’t ever go directly through the agency websites unless you have a promo code).

    • HaileUnlikely

      N.b. Bodily injury liability and collision damage waiver are entirely different things.

    • You are incorrect. Damage and liability are two different things, and most credit cards ONLY cover damage up to a certain point, say $50k. If you are driving a full size van, suv, or box truck it is valued WELL over $50k.

      Don’t be cheap when dealing with insurance, pay the $11 a day, and travel safely.

  • I had a policy like that through Travelers Insurance for about 2 years, as I rented cars frequently for long trips. It was coupled with a condo and umbrella liability policy, and I think ended up around $350/year for the “auto” and umbrella policy. Pretty sure USAA also offers policies like that, though you need to have the requisite military connections to sign up for USAA.

    • USAA does offer it and I bundled it with my property insurance. It’s cheaper than GEICO (which I priced as a comparison). I use a combination of Zipcars, Car2Go, rental cars and decided that I wanted something consist in terms of coverage. Also, I figure at some point in the next 3-5 years I’ll probably buy a car again and figured it wouldn’t hurt to not show a gap in coverage/driving history.

      • We had a non owners policy from USAA was less than $100 a year and it provided supplemental coverage when the wife was punted with a car (she was on a bike) by a guy that had minimal coverage.

  • We have a Citibank Aadvantage credit card which not only offers frequent flier miles but also covers car rental insurance (not including luxury vehicles, pickups or SUVs.) We do have regular State Farm car insurance that also covers rentals. Check the fine print – you need to make sure whatever you get will cover the cost of repairing or replacing a vehicle in an accident or if it is stolen and totaled, and medical for victims. Also, take pictures of any dings when you pick up the car. Rental agencies will try and dick you for the price of repairing stuff that was broken when you got it

    • Citibank covers up to $50k damage…which isn’t a whole lot these days. If you total two $30k cars, in one accident you’re on the hook for the remainder….

  • USAA offers this insurance at a great rate. As with all USAA insurance the customer service and price is great, but you must meet the military connection qualifications.

  • Those of you bragging about your credit card coverage are MISSING THE POINT. No credit card covers liability. All they cover is the rental car itself. If you have an accident and hurt someone or damage their car you need liability coverage.

    • Exactly. I don’t know of any cards that offer 3rd party liability insurance. Your liability for 3rd parties is pretty much unlimited. This is why this is the most expensive insurance add-on at the rental car desk.
      If anyone knows of a credit card that offers comprehensive coverage + 3rd party liability, please let me know! I will sign up immediately.

  • Purchase an umbrella policy on top of your homeowner’s or renter’s insurance policy. You’ll get $1 million in coverage and will provide the liability coverage that you seek. It will also extend to all sorts of non-auto liability instances as well (e.g. if you accidentally drop a piano on someone’s head).

    • Your standard homeowners/renters policy will cover you in the piano situation — or the more common scenario of a ski accident or similar “personal” liability situation.

      I would double check your policy as to whether your umbrella liability policy on top of your homeowners/renters policy actually covers you in an auto liability situation. A lot of them don’t. I think the safest route is to get an umbrella liability on top of your auto policy and then a separate homeowners/renters policy.

    • Industry vet here. This statement may be confusing. The OP is seeking automobile liability coverage for non-owned automobile use. Umbrella policies are an above-and-beyond secondary source of liability coverage for the associated underlying primary policies with the same insurance carrier.

      If the only underlying policy is homeowner or renter’s insurance, and there’s no auto policy beneath the umbrella, there won’t be umbrella coverage for an automobile-related liability.

      • It depends on what insurance company you have, though in every case, you have to ask the right questions.
        .
        I have a non-owned auto liability *rider* on my umbrella liability. It has separate, similar limits to car insurance (100/300/100), and costs about what others have mentioned above, ~$100/extra/year. That’s about 1/3 what others have mentioned for stand-alone non-owners policies (and those numbers are similar to what I found for those, as well), so it was worth it to me as someone who carries umbrella liability anyway. Note that they did run a check on my driving record before adding that rider, so if you have collisions or tickets, that will drive the cost up (I hadn’t had a moving violation or ANY collisions (even not-at-fault) in over 10 years when I added the rider). Note also, if you have no need for an umbrella liability policy, the stand-alone non-owner policy will probably be cheaper than both together, and if you rent less than 20+ days/year, the rental company’s liability insurance may be even cheaper than any of these choices.

        • D’oh, I also set that up right when I sold my car! While I did join Zipcar on the day I sold my car, I actually go the rider with no “break in coverage” for an owned auto policy, which probably made it a bit cheaper than for someone who didn’t know about the “break in coverage” premium on insurance and went without for some time.

  • One thing to keep in mind for those who dont have a car, is that if you dont get a NNO policy, car insurance companies consider it a break in your insurance history which can cause you to end up with very high rates when/if you do get a car down the road.
    .
    Not saying cost wise its worth it, but I have had a number of friends who had cars and got rid of them years ago, and when they had to go back to having a car, had their insurance rates be double or triple what they previously paid.

    • HaileUnlikely

      This is true, however, if you are a Zipcar member, they will provide you with a certificate of coverage. Basically, as a Zipcar member, you are an authorized driver of vehicles under their policy, just like if you drove for your employer and were named on a fleet policy.

    • With the $15,000 that the Triple-A towing service says average Americans spend on each car, I think what I save by cycling and renting these last years will cover whatever the surcharge may be. Definitely no accidents on my record, either.

  • I also had NNO insurance when I didn’t have a car, $400/year, through Eire Insurance. I actually ended up needing it not when I was driving, but when as a pedestrian I was hit by a car, since I had under-insured motorist coverage.

    • HaileUnlikely

      Would you mind posting your agent’s name or emailing it to me (my user name, without spaces, at gmail). I have Erie for homeowner’s insurance, and when I inquired about this, my agent was unfamiliar with it and told me that Erie did not offer any such thing.

  • It’s kind of terrifying how many people have no idea the difference between collision and liability coverage.

    There are exactly zero credit cards that get you liability coverage, folks.

  • I use Allianze (formerly Access America) whenever i get a rental car. They have a number of different “levels” of coverage staring at $9/day.

  • Interesting comments, all. I looked into this a few months ago but kind of got discouraged and gave up/set it aside.
    I’ve been car-free for several years since moving to DC, and it never occurred to me that I would face higher rates when I do get a car again (which I’ve been considering). People have mentioned ZipCar — does anyone know if this would apply to Car2Go? (I cancelled the former because it didn’t work for me, but I use Car2Go all the time.)
    Any other ideas for “rebuilding” my insurance history so I don’t get sticker-shocked when I do buy a car? Any carriers that are more understanding of this?

    • HaileUnlikely

      I do not know whether this would apply to Car2Go. I mean, conceptually, there’s no reason why it would not. However, I do not know whether Car2Go has a practice of providing such a certificate of coverage to their members, as ZipCar does. I’d recommend asking them.

  • If I could put in a plug for under-/uninsured motorist coverage for a minute, inspired by HC and phlox above: The last estimates I saw for the region were that anywhere between 10% and 30% of drivers are not carrying insurance of any kind. Protect yourself, especially because I suspect that among bad drivers the rate is even higher.

    • HaileUnlikely

      Between that and hit-and-runs, yes, agreed. Not sure about DC, but in some major cities, the driver leaves the scene in nearly half of all crashes resulting in injuries to pedestrians.

    • There’s also a new phenomena that unfortunately I discovered. Having the driver buy insurance on their phone AFTER having the accident, but before the police came. Driver made one payment, and the insurance company was unable to contact him ever again. They covered 1/2 the cost of the damage.

      Uninsured coverage didn’t cover it, because he “had” insurance, and it wasn’t worth suing over.

  • If all you need is primary insurance for rental cars, I’d recommend http://www.insuremyrentalcar.com . They do CWC/LDW for rental cars for $94 a year. Pretty good deal if you just want some basic coverage for some peace of mind

  • I didn’t read all the posts, so if someone already said this, I apologize. I looked into this when I first moved from Chicago and the quotes were ridiculous. Finally found a reasonable policy through GEICO.

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