Strategies, Challenges, and Answers

Do I Need To Buy The Insurance That The Rental Car Company Offers Me When I Rent A Car In Nevada?

In Nevada, rental car agents are legally obligated to confirm only two things about you before they rent you a car, that you have a current driver’s license and that the signature you made on the rental contract matches the signature on that driver’s license.  See N.R.S. 483.610 and our previous blog post on this topic, HERE. [Insert link to Feb 21, 2011 post on the Insurance Blog]  The rental car company is not obligated to ask you if you have insurance.  Instead, they will ask you to buy additional protection.  Do you need it?

If You Have No Auto Coverage, Load Up On The Coverage That The Rental Car Company Offers 

Nevada Insurance Law, Mills & Associates Nevada Insurance and Coverage Lawyers 702-240-6060 If you have no automobile insurance, the answer is an unequivocal YES!.  If the rental car is damaged in
any way while it’s in your possession, you are going to be liable to pay back the rental car company for that damage.  That is true even if someone else (including mother nature) causes that damage.  Here is a sample of what you are agreeing to if you have no automobile insurance:

You are absolutely liable and you agree to pay us for any loss of or damage to the Vehicle, even if someone else caused it or the cause is unknown, whether due to theft, fire, hail, flood, collision, vandalism, or any other cause.

Keep in mind, damage to the rental car should be only a part of your concern.  How will the rental car company treat you if you hurt someone in an accident and you have no insurance?  Here is a preview of what’s in store if the rental company gets sued for your negligence:

You agree to indemnify and hold us harmless from and against, and will defend us against, any and all loss, liability or damages whatsoever caused by or arising out of the use or operation of the Vehicle during the rental plus costs and attorneys’ fees.

If you hire a lawyer to translate that legalese, he or she will explain it as follows:

If someone sues the rental car company and it is forced to pay for injuries or damage you caused using the rental car, you must reimburse the rental car company, not just for the amount that it paid but for its attorney’s fees as well.

So if you have no personal auto insurance, you need to load up on coverage offered by the rental car company.  Be sure to buy what is known as Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) coverage.  That will protect you from the rental car company coming after you if you damage their car.  Also buy the Supplemental Liability Insurance (SLI) which should protect you from most injuries or damage that you may cause to others.

If You Have Auto Coverage, Read Your Personal Auto Policy Or Check With Your Insurance Company To Find Out What Will And Will Not Be Covered And Make Your Decision Accordingly 

As you can see, the consequences of not having insurance are significant.  The same consequences could befall you if the personal auto coverage that you have does not address the risks particular to renting a car.  For example, if you drive a clunker and you did opted not to buy comprehensive or collision coverage (the coverage that pays to have your car fixed if a tree falls on it or if it is involved in the accident) it is likely that your insurance will not pay for these same types of damage to a rental car.  If that is so, you will want to buy the CDW or LDW coverage from the rental car company.  You need to make the same type of analysis regarding liability coverage or other coverages that the rental car company offers.

Obviously, you could gather the information on what is covered by reading your personal policy.  However, those documents are long, difficult to understand and often intimidating.  Therefore, a great source of information as to whether your personal coverage will be sufficient is your personal auto insurance company.  An agent or other representative of the company should be able to answer those questions for you.

Have a great stay in Nevada.  Drive your rental car carefully.  But before you start on your trip, do this little bit of homework.  It could save you a lot of grief in the end.

About Michael Mills

Mr. Mills practices in the area of civil litigation and appeals, with particular experience in matters involving trucking liability, insurance defense, insurance coverage, premises liability, products liability and defense of personal injury. Mr. Mills is a member of the Trucking Insurance Defense Association, the Defense Research Institute Trucking Committee and the Nevada Motor Transport Association. Mr. Mills is licensed to practice before the Nevada Supreme Court and the Utah Supreme Court. He is also licensed to appear before the United States Supreme Court, the U.S. District Courts for the Districts of Nevada and Utah, as well as the U.S. Court of Appeals for the Ninth Circuit. Mr. Mills has created 3 Blogs for the benefit of the insurance industry. He serves as editor and publisher of the Nevada Insurance Law Blog, the Nevada Coverage and Bad Faith Blog and the Nevada Trucking Law Blog.

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