Your personal auto insurance policy will likely cover the rental car but insurance policies and their terms can differ from one insurance company to the next. I would suggest reviewing your car insurance policy, or ask your insurance agent to review it with you, to see if it states if your coverages would extend to a rental. Your policy may cover autos rented for pleasure, like vacations or special events, but not business.

If you do not have physical damage coverages, comprehensive and collision coverage (often referred to as "full coverage"), for your own car, you may not have coverage for a rental car. And if you damage a rental car, your policy may not cover lost revenue the rental car company incurs while the rental car is being fixed; or the cost of a new car if you total the rental vehicle.

If you find that your insurance policy does not cover a rental car or does not totally cover a rental vehicle for things such as lost revenue, then you will probably want to purchase the optional insurance, such as the loss damage waiver, that the rental car agency offers.

Many credit cards also offer rental insurance if you pay for the rental car using their credit card. Check with your credit card company to see if they offer this.

Read our article, titled Should I Buy Rental Car Insurance?