The Economics of an Annual Car Rental Insurance Damage Policy

I haven't owned a car coming up to 10 years now (since 2008), but that doesn't mean I don't drive! In fact, this year alone I've rented for more 60 days for both business and leisure.

I tend to rent from the local Enterprise rent-a-car depot in the East Village of Des Moines Iowa, who provide a great and friendly service, and not surprisingly recently I became a Gold tier renter after 13 rentals and 40 days :-) I like the Enterprise service because I don't have to prepay, I can cancel anytime free of charge, I pretty much always get an upgrade, the weekend prices are ridiculously low and they'll even pick you up if need be. 

Couple things that I don't like are the very expensive one way fees, that the fuel tank is not alway full (which means I have guess how much gas to put in),  the expensive collision damage waiver, an extra fee to insure personal effects and the fact that they keep asking me if I want their insurance even though I've never purchased it.

Given I've rented 13 times with Enterprise over 40 days this year - if I was to take up their Damage Waiver (CDW) and Personal Effect Coverage (PEC) I would have paid a whopping $1,160!

Now this reality is not new to many people who rent often, and its a topic that consumers complain about a lot, you just have to search "Car Rental Insurance" on TripAdvisor and you'll find a plethora of posts where people are complaining about car rental insurance.

So rather than complain, I did two things:

  1. Firstly, I negotiated with a large insurer to source an annual car rental damage insurance policy that covers what I needed and is super affordable.

  2. Secondly, I setup a website where other frequent renters could buy this of annual insurance policy allowing them to save a huge amount of money each year.

So the policy is underwritten by Allianz (the worlds 3rd largest non-health insurer) and covers the following:

  • Up to $45,000 damage, theft coverage (fire, storm, hail, vandalism, windscreen, tires) 
  • 45 days coverage per rental
  • Annual Coverage
  • Zero Deductible
  • Return Early Refund
  • Loss-of-Use and Diminished Value
  • No Distance from Residence Restrictions
  • Baggage/Loss Damage up to $1000
  • 24 Hour Travel Assistance
  • Costs $125 Annually

Now lets return to the title of this blog post; "The Economics of an Annual Car Rental Insurance Damage Policy"

  • Enterprise would cost me $1,160
  • costs me $125

The economics seems to speak for themselves! Even though I really appreciated the Enterprise car rental service, I always pass on their rental car damage coverage, given I now have an annual car rental damage policy that covers what I need and is very affordable.