Font ResizeDear Mary: Car rental companies tell me that if I get in an accident, they can charge me for the car's 'diminished value.' I am not covered for this on my auto insurance. If I want this coverage, the only thing I can do is pay for rental car insurance, which is about $12 a day. This seems unreasonable to me.
— Phoebe B., e-mail
Dear Phoebe: How much risk are you willing to assume when you rent a car? If your answer is 'none,' then you have no choice but to pony up to that pricey add-on. If you are willing to share the risk you might crash that rental car and become responsible for its diminished value, then opt out and keep the money.
My insurance philosophy is to have coverage for big risks that would wipe me out financially but to self-insure the smaller events by opting for high deductibles whenever possible. Personally, I would not pay $12 a day for this insurance. Statistically, I know the chance of needing rental insurance is low.
