A Personal Automobile Policy provides coverage for vehicles you do not own while used as a temporary substitute. However, it will only extend the same type of coverage that your vehicle is insured for. For example, if your vehicle is only insured for liability, this coverage would extend to the rental vehicle. If you carry physical damage coverage (ie: Other Than Collision and Collision) on your insured vehicle, this same coverage is extended to the rental vehicle.

Typically, the rental car agreement will include these provisions in it:

1. Diminution in Value- This charge represents the reduction in a vehicle’s market value due to it having been in an accident. When the car is eventually sold, it brings a lower price. Most auto policies cover most of the repairs, but few cover the diminution in Value.
2. Before and After- This is method used in determining the renter’s responsibility when a car is substantially damaged. Today, many damaged rental vehicles are never repaired due to liability concerns. Instead, the rental car company will sell the damaged vehicle for salvage. They will then turn around and charge the renter the difference between the market value on the day of the rental (before) and the salvage amount (after.)

Due to these common provisions found in a rental car agreement, we recommend that when renting a car that the loss damage waiver be purchased from the rental car company. Buying this waiver is the only way to the close the gap between the coverage provided under the Personal Auto Policy and the provisions found in the Car Rental Agreement.

Note: If you are using a credit card when renting a vehicle, please check with your credit card company as they might provide the loss damage waiver coverage.

Disclaimer: Our site contains general descriptions of the policies and coverages we provide. While you may use our site to help you understand the different types of coverages available, it does not describe all of the terms, conditions, limitations, or exclusion in your policy, nor does it modify or change any definitions expressly states in any contracts of insurance. Please read your policy contract fully to understand your coverage.

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Coverage cannot be initiated or changed by email or leaving a message, you must speak to an agent.

Street address: Klein Insurance Group, 702 N. High Point Rd, Suite 201, Madison, WI 53717-2283
Mailing Address: Klein Insurance Group, PO Box 45470, Madison, WI 53744-5470
Phone: (608) 831-9700 or (800) 643-6133 FAX: (608) 831-4777
Office Hours: Monday - Thursday 8:00-4:30 Friday 8:00-3:00