last Updated on January 9, 2022 by Michael
Renting a car in the Golden State ? There ’ s a car rental insurance gotcha in California that you need to know about .
You may normally decline indemnity at the counter because you ’ re covered by your personal car insurance policy or a credit card profit. But when you ’ re renting a car in California, you may need to rethink this strategy. ( Our primer on rental Car Insurance explains all. )

Do You Need Rental Car Insurance?

first, let ’ s have a quick refresher course. There are generally two types of cable car lease indemnity : collision damage ( CDW ) and indebtedness. Each covers a different scenario.

Let ’ s say you ’ re in an accident that damages the rental car. In general, you need damage protection ( CDW ). A new law in California regarding rental car CDW went into impression in January 2022. rental car companies are able to charge up to $ 25 per day for nonprescription collision indemnity. ( previously, collision indemnity for economy and compress cars were capped at $ 11 per day, while intermediate, standard, and full-size were capped at $ 17 ) .
Most credit cards lone provide junior-grade damage protection. In a nutshell, that means coverage only kicks in after the primary coverage terminus ad quem is hit. If you own a car, your own car indemnity policy is the primary coverage for collision damage .
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The second type of insurance is liability coverage. If you ’ re in an accident that results in bodily harm to other individuals or place damage, your likely liability is huge .
In most states, the rental party must provide the state of matter minimum coverage by police. That means you normally don ’ t need to buy any extra coverage to meet legal requirements. however, if you have a personal car indemnity policy, it would normally cover rental cars .

The Insurance Trap with California Car Rentals

unfortunately, California marches to its own tune. In the Golden State, rental car companies do not automatically provide liability protection in the standard rental agreement. ( Some companies may provide basal indebtedness protection to international renters with non-U.S. driver ’ mho licenses. )
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This means renters in California need to provide their own indebtedness policy. In general, U.S. residents may already be covered by their regular car indemnity. But you should confirm that they have the minimum tied of indebtedness policy from their policies. If not, you need to purchase purchase liability policy through the car rental caller.

3 Options for Rental Car Liability Insurance in California

If you ’ re renting a cable car in California, you are in one of three camps :

You Already Have Valid Liability Insurance

If you have a valid insurance policy that covers rental cars in California ( a personal policy or a non-owners policy ), you don ’ t have to worry about liability since you are already covered .
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If you fall into this bucket, you only have to worry if you rent a cable car that is more valuable than the one you own. Your coverage may be limited to the prize of your personal car .

You Don’t Have Insurance and Buy Liability Coverage

If you buy liability coverage from the rental car company, you are covered at least the minimal requirement to operate a car in the state of California .

You Don’t Have Insurance and Don’t Buy Liability Coverage

There ’ s a Catch-22. rental car companies do not require liability insurance, but liability policy is required to legally operate a vehicle in California. furthermore, the rental car company does not need to check that a driver has liability insurance. Nor can a lease cable car company mandate that a driver purchase indemnity. In other words, it ’ s the renter ’ s province to comply with California ’ south law .
A driver can leave the rental car company ’ s lot without liability insurance. But this would not alone be illegal but laughably stupid. The cost of this error can be huge ; a driver without liability indemnity who causes an accident is personally creditworthy for any claims .
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furthermore, if you interact with police for any reason—such as a traffic misdemeanor or accident—driving without liability indemnity can land you with fines, points, and/or loss of license. evening as a non-resident in California, it ’ s your duty to read the rental rules. In addition, you should understand the police and protect yourself with liability indemnity .
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