USA is an ultimate destination for travelers and they often hire cars to either travel for pleasure or business. Before you hire a car, you need to understand that car hire insurance process in the USA is different than any other country. If you are covered already, this is not something that should bother you.

We often feel buying a Collision damage waiver insurance (CDW) is unnecessary. Well agreeably so, but do you know how life saving it becomes at such times when you don’t have any primary insurance in place? 

Read further to get a hang of what the insurance process looks like in the US territory and how it can make your life simpler. 

The best way to move around while on vacation in the United States is with a car. If you are visiting for a short period, hiring is your best option; hence insurance should be taken seriously. This article offers insight on the major insurance needed when hiring a car in the USA.

Collision Damage Waiver

Collision Damage Waiver is like a loss damage waiver, typically sold by car hiring companies, it covers you financially; from damage and theft. 

It’s not compulsory to purchase this insurance, but, it is useful. For instance, say your credit card rental insurance already covers for collision damage; getting claims will take a longer process because you will have to pass through your auto insurance company first. However, with Collision Damage Waiver you’ll engage in a direct transaction. 

Supplemental Liability Insurance

This type of insurance protects you on damages done to other people, their cars, and other properties. If a third party gets injured within the rental period, the Supplemental Liability Insurance will pay for medical expenses. 

The United States takes Supplemental Liability Insurance seriously, so be prepared to buy it if you are renting in any of her States. However you must know; Supplemental Liability Insurance bought within the United States won’t cover you abroad.

You can buy supplemental liability insurance directly from your insurance company, a third party or the umbrella liability insurance.

Personal Accident Insurance

This is the alternate version of the supplementary liability coverage insurance. Rather than cover other people, the personal damage insurance covers you. 

If you have an accident, both you and your passengers get medical, ambulance and death coverage.

However, the personal insurance coverage can overlap with health, life and car insurance policies, so it’s important to read their terms and conditions to avoid paying for a policy that you are already covered for. 

If you are holidaying in the United States,  ensure your travel insurance covers your medical expenses, if it doesn’t, consider getting a personal insurance coverage. 

Personal Effects Coverage

With personal effect coverage, you don’t have to worry if items from the rented car get stolen so long the stolen property is within the set dollar limit.

If you already have rental insurance however, you may not need the personal effects insurance. Thus, It is important to check your policy documents or call the customer care service to know if you have such coverage already.

Car excess waiver rental insurance

In the United States it is compulsory to pay car hiring companies a certain amount “excess” this excess serves as collateral in case there is damage to the rented vehicle. Car excess waiver rental insurance is a policy that will help you cover the excess.

 There is no fixed amount for excess, it varies according to factors like location, vehicle type, and age. Car excess waiver rental insurance keeps you covered.

Car rental excess waiver insurance  insurance can be confusing, but here’s a breakdown of how it works if you already have collision damage waiver you’ll still have to pay for excess in case of damage or theft. 

Excess are expensive ranging from $200 to $5000, but with a car excess waiver rental insurance you’ll already be protected from excess fee.

The car excess waiver rental insurance is just like the travel insurance because you can buy it as a single policy or annual policy (if you are renting frequently). 


Finding out which Insurance is needed when hiring a car in the USA can be tricky, you can’t perform a random pick. You might be buying a policy that you don’t need or a policy that you are already covered for. So, you must do a thorough research first and measure your risks. 

This will help you identify areas that makes you vulnerable and cover them accordingly. Next, you’ll have to decide whether you’ll be buying from the car hire company, credit card coverage, or a third party.  Consider cost too, there are companies that offer discounts. Finally, don’t just make assumptions, if you are not sure of an adequately coverage, buy new insurance. 

Thanks for reading.



Cheryl Posner is the owner of Winey Mommy. Of course, she loves wine, her family, and writing about it all (in no certain order).

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