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My hard-earned lesson about rental car insurance

Karen Queen

My expensive lesson about car rentals and credit cards came amid chaos. My family was already struggling to make two cars work with three drivers. Then my teen daughter had an accident, sending half of our small fleet to the shop. Our credit cards took a double hit — the $600 repair bill and about $250 for the rental car we had to have while repairs were made.

What else could go wrong? A deer ran into the rental while my husband was driving it.

The good news: daughter, husband and Bambi all were fine.
My hard-earned lesson about rental car insurance
But Bambi, although at fault, had no insurance.

And  the luck of the draw — in this case which credit card my husband drew from his wallet to pay for the rental car — cost us another $600. Here’s what happened and what we learned.

As always, we had declined the optional car insurance offered by the rental agency. We have a good auto insurance policy with State Farm that covers us. But since our cars are 20 years old (mine) and 12 years old (husband’s), we carry a $500 deductible. That saves us money with a lower premium; we don’t fix minor dents anyway or file claims for repairs that are within a few hundred dollars of our deductible (which helps keep our premiums low). If the Bambi incident had happened on one of our cars, the dent to the bumper was so minor we would have shrugged it off. Not so with a rental.

So as soon as we admitted the accident when we turned in the car, the rental company required us to pay the $500 deductible.

Then I heard we might be covered by our credit card. My hopes soared, then crashed. After multiple phone calls, I learned we had used the one card, a MasterCard through our credit union, that didn’t cover us even though we’ve had the card for 25 years and have a low five-figure credit limit. If we had used either of our two Visa cards, we would have been covered for the deductible.

Total damage for the deer encounter with a barely noticeable bumper ding was about $700, including repairs, the rental agency’s loss of use during repairs (a charge that even many rental car insurance plans won’t cover) and depreciation. The repair portion of the bill was only another $100 beyond the $500 we had paid, so we didn’t bother filing a claim — we just paid the remainder out of pocket.

However, the rental agency also wanted to charge us $100 for what it called an administrative fee. No way was I paying that — handling administrative tasks is why companies have administrative staff. I calmed down, called the car rental agency and asked for the fee to be removed.

Silver lining: I got no argument on the administrative fee — it seemed as if the busy manager had gotten many of these requests before. A 30-second phone call saved us $100, a good rate of return on my time invested.

Lesson learned: Within a month, we rented a car for more than two weeks for a vacation, used a different credit card, and double checked our credit card policies to verify we were covered for our deductible no matter who was at fault.

The $100 I had saved on the administrative fee? It paid for a nice meal out.

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