Is extra protection worth the additional cost of car rental insurance? Here's how to decide

Rental car insurance restrictions Many believe a rental car is covered with personal insurance policies or credit cards, however there can be problematic restrictions.

There could be some limitations to solely relying on credit card and personal auto insurance policies to cover rental car insurance.

Sean Beasley, who spends a lot of time on the road, pays an added cost to his insurance policy, and car rental coverage is included.

"I would say I rent a car probably about 20 times a year," Beasley told CTV News Toronto.

"I don't get insurance because my vehicle insurer automatically offers us rental car insurance. Both auto insurance and credit cards can have significant limitations regarding rental cars, including what kinds of vehicles they cover, for how long, and in what countries."

Since rental car insurance can be costly -- sometimes costing an additional $50 per day -- when does it make sense to add it with a rental?

According to Consumer Reports, depending on the coverage you have for your own vehicle, you may need to get a separate rental policy.

"If you only have liability insurance on your own car, you'll need to get a separate policy for the car rental in case there's damage to it in the event of a crash," explained Lisa Gill with Consumer Reports.

Here are some guidelines to help you decide if extra coverage is right for you.

Some credit card rental insurance and personal auto policies won't cover certain car types or classes, like luxury or large sport utility vehicles.

If you rent in a foreign country, many companies say your auto insurance coverage extends only to car rentals in Canada and the United States. The same goes for rental insurance offered by most credit card companies.

Finally, standard auto or credit card insurance policies typically do not cover RVs, cargo vans, and moving trucks.

If you decide to add extra insurance, consider adding up to three types: collision damage waiver, which covers damage to the car in case of a wreck; loss damage waiver, which protects you from theft and damage to the vehicle; and liability coverage which covers you if you are found legally responsible for property damage or for injuring someone while driving the rental.

The terms may vary slightly depending on the rental car agency, so read through the policies carefully to ensure the vehicle has the necessary coverage.

Last year, Thomas Coish told CTV News Toronto he declined to pay for rental coverage when renting a pick-up truck. He thought he was covered by his own policy but found out he wasn't. Unfortunately, the truck was stolen and he had to pay $50,000 to cover the loss of the pick-up truck.