Do I need supplemental insurance coverage when renting a car?

Q. Whenever I rent a car, the customer service representative offers several types of added insurance coverage. What exactly are they offering, and given that I already have auto insurance, do I need to pay for this additional coverage?

A. Insurance add-ons can top car-rental costs for consumers who sign on for all the available options. So it's important for renters to check on the provisions of coverage they already have to figure out what, if any added insurance, they need.

Most rental car agencies offer four types of coverage. The most common is a collision damage waiver, also known as a loss damage waiver. Technically, this isn't insurance. Instead, a renter pays $9 to $16 a day and, in exchange, the company's waives its right to recover damages from the consumer if a vehicle is damaged.

In addition, many rental agents offer personal accident insurance, which provides death and medical coverage to the driver and passengers in case of an accident. Many companies offer it in conjunction with personal effects coverage, insuring loss or damage to items in the car. Typically, the two together add $4 to $5 a day to a renter's bill.

Finally, many rental agencies also offer supplemental liability insurance, providing coverage if the renter kills or injures someone or damages someone else's property. That can add another $7 to $8 a day to charges.

All these types of coverage would be valuable in a vacuum. But many drivers already carry such coverage and just don't know it.

"It's up to the individual to make a determination whether they need these coverages or whether they have these kinds of protection," said Russell Bruno, executive director of the Association for Car and Truck Rental Independents and Franchisees, an industry group. "We can't make that decision for them."

Many credit cards include insurance on rental cars, but consumers need to check on the terms of such coverage. Some banks have been quietly eliminating such coverage from the benefits they provide with cards, usually disclosed only in fine print on card agreements. Many of the cards that do provide coverage do so only on rentals in the U.S., a benefit that is useless for a vacation overseas.

In addition, many auto insurance policies provide coverage that extends to use of a rental vehicle, but the provisions can vary. Some auto policies, for example, might cover medical expense reimbursements, which are generally not covered in credit card agreements.

Renters may also want to check with their employers, if they're renting a car for business travel. Many employers negotiate contract rates with rental agencies, and those agreements usually include a collision damage waiver, Bruno said.

"Let the buyer beware," he said. "You should keep your eyes open whenever you enter into a rental contract.