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13 Rental Car Rules

Michael Flack

IN SEPTEMBER 2017, my wife and I sold our home, car and almost all our earthly possessions. We spent the next four years driving across four continents. Along the way, I learned a great deal about renting a car that, in this rental-car-challenged world, could make your travels less costly and more reliable.

1. I use Expedia, Kayak and Hotwire to compare rental car rates. When you book, pay attention to whether your reservation is free cancellation or pay now (noncancellable). You can sometimes save with a noncancellable booking, but what if your plane is delayed or you cancel your trip?

2. Rental companies use bait-and-switch pricing. You notice a car you like for $30 a day. Since you will be renting for three days, you would expect to be charged $90. Wrong. When you click “book,” the price is now magically $205.72 due to concession fee recovery, vehicle license cost recovery, customer facility charge, tax and whatever else. The upshot: Look carefully at the bottom line before booking.

3. One option is to book a free cancellation rental car and then scour the internet for a better deal. Payment may be charged prior to the fully cancellable date, so—if you cancel—you’ll have to wait for the refund to hit your credit card. If this is a foreign transaction, changes in the exchange rate could cause the refund to be more or less than the initial charge. If it’s less, call your credit card company to ask for the difference. If it’s more, don’t bother.

4. Almost all rental car companies make you pay an extra fee for an extra driver unless it’s your spouse—and some charge for your spouse as well. In some states, such as California, this is against the law. In others, the additional-driver fee is capped. Do your homework and confirm the charge at the rental counter.

5. Beware the manager’s special. The manager’s special generally offers significant savings, but you could end up with a van, mini-van, pickup truck or exotic car that’s hard to drive. Worse yet, your credit card or auto policy may not provide insurance coverage for that type of vehicle.

We rented a manager’s special in Michigan to save $250. It was a Ram 1500 pickup truck. After snaring the rear bumper on a utility pole guy wire—don’t ask—I discovered my insurance didn’t cover pickups. Uh-oh. The wife took it to get the bumper fixed and, because the body shop couldn’t perfectly repair it, she wasn’t charged. When she returned the truck, the rental car company didn’t mind the minor imperfection. It was our lucky day.

6. Most rental car companies will offer you some kind of toll transponder for a fee. In some places, such as New York City and New Jersey, it’s almost a necessity. But in Los Angeles and San Diego, you won’t need it because tolls are paid online via tag number.

If the rental car company charges your credit card for tolls after returning the car, dispute them if they seem unreasonable. After one trip, I noticed a $25 toll charge from the rental car company. As this seemed a little steep, I disputed the charge with my credit card company and won.

7. Document existing damage to the car and take photos or a video of the car prior to leaving the rental car lot. While you’re at it, snap a photo of your rental contract.

We rented a car in Marrakesh, Morocco, and returned it at the Rabat airport. The agent claimed the left front blinker was damaged. Fortunately, I had a photo showing the damage was preexisting. Case dismissed.

8. If the tank isn’t full, take a photo of the gas gauge at pickup and at return. We rented a U-Haul van to move all the worldly possessions of my dear 92-year-old mother. Dropped the van off in Herndon, Virginia, and took a photo of the gas gauge. A few weeks later, I was charged $30 for not returning the van with the same amount of gas it had when I picked it up. I showed them the before and after photos, and the charge was reversed.

9. The collision and comprehensive coverage on your existing auto insurance will generally provide collision and comprehensive insurance for your rental car. Ditto for your liability insurance coverage.

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If you don’t own a car, it may be worth it to buy rental car liability insurance that provides liability insurance in the U.S. Have a copy of your insurance card because some rental car companies make you buy liability insurance if you can’t prove you have auto insurance. This happened to me in Puerto Rico.

10. Compare the price you were quoted online with the rental contract you’re being asked to sign. Make sure you understand any and all additional charges, such as toll transponder, GPS and upgrades. If you need to dispute unexpected additional charges, this will help your case with your credit card company.

11. Compare the rental contract price with the amount your credit card is charged. It should be the same as the final invoice that was printed or emailed when you returned the car. If there’s a difference you don’t agree with, dispute the charge. I was once charged $422.72 more than the rental contract price. I disputed it with my credit card and won after I produced a photo of my rental contract price.

12. As a rule, don’t buy collision damage waiver coverage in the U.S. You’re more than adequately covered through your auto insurance and credit card. If you’re renting outside the U.S., review your credit card benefits. Many credit cards specifically exclude this coverage in Israel, Jamaica, the Republic of Ireland and Northern Ireland. If in doubt, get a document from your credit card issuer verifying coverage. You may need to show it at pickup—and, if you don’t have it, you may be required to purchase insurance.

13. Renting an automatic transmission overseas can be quite costly. I rented a car with a manual transmission in Ireland and the U.K., and managed just fine. What one man can do, another can. When backing up, however, just remember to look over the “other” shoulder.

Michael Flack blogs at AfterActionReport.info. He’s a former naval officer and 20-year veteran of the oil and gas industry. Now retired, Mike enjoys traveling, blogging and spreadsheets. Check out his earlier articles.

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Rick Sany
Rick Sany
1 month ago

I don’t see any comments about a GREAT way to find low prices on car rentals. I’ve used this service for 5+ years and it’s a lot easier than scouring the web for cheaper rates. The website / service is http://www.autoslash.com You can use it to find rentals (it will apply any discounts you tell it you have access to, e.g. Costco, frequent flyer programs, certain credit cards, AAA, AARP). You can also request they track a current rental and they send an email when they have located a less expensive rate.

For example, the last trip I took to Lake Tahoe, California (August 2021) the rental started out at $846 for a Full sized car. Autoslash.com was able to find 6 lower prices over the course of 2 months: final cost $361.

I can’t say enough about how fun it is to get an email telling me they found a cheaper rate. It’s especially nice because I don’t have to do any more than enter the details of the rental car reservation (time to enter, about 3 minutes)!

mjflack
mjflack
1 month ago
Reply to  Rick Sany

Autoslash.com sounds intriguing. I’ll definitely give it a try next time, maybe in conjuncture with Rule #3

RideV65S
RideV65S
1 month ago

If you rent in the EZ-Pass area, get one and stick it on the window. Turn off the rental one. Many states don’t take cash anymore and the plate readers will bill the rental companies if you don’t have an EZ-Pass. In my state I can put the car tag number on my EZ-Pass as a rental. Some states issue EZ-Pass boxes with minimal fees + deposits don’t expire.
I also travel with a dashboard GPS. They are usually better than the car nav systems. Just don’t leave your stuff in the car when you rush to the plane.
I had a curbing hit on a recent trip. It was to a busy city I didn’t know so I took CDW. Returned the car, the guy saw the dent, looked at the contract and I never heard a peep afterwards – no papers filed. Sometimes the peace of mind is worth it.

mjflack
mjflack
1 month ago
Reply to  RideV65S

I’m not sure if getting an E-Z Pass for your rental car makes sense unless you travel to the area quite frequently. I agree with the importance of having piece of mind, though if your curbing damaged the tire, the undercarriage, or occurred while you were off-road or drunk, then you would find your piece of mind illusory.

John Wood
John Wood
2 months ago

To SanLouisKid’s excellent points, if you don’t have an AMEX card, you can enjoy similar benefits by buying the Physical Damage Waiver (PDW) from the rental car company.

Like the AMEX strategy, any claim under the PDW stays off of your insurance record (unless it’s an at-fault accident where your Auto Liability comes into play with the other party).

With the rental, you may be driving an unfamiliar car, in an unfamilar town, going to places you’re visiting for the first time. Possible result: Increased driving risk, as you have a lot of distractions, so buying the PDW lays that increased risk off on the rental car company’s policy, rather than your own.

Convenience. If you have the rental car company’s PDW, and you damage the car, on the day you drop it off at the airport, you just toss them the keys because their insurance is paying for the damage. If you use your own insurance, or your credit card insurance, be prepared to be there awhile completing paperwork, while your flight time draws near.

Also, if you use your credit card option, my understanding is that the rental car company will charge the card instantly for their estimate of the damage (which is frequently overstated), and the insurance proceeds are applied to your new credit card balance (better have ample limit on the card).

Yes, the PDW is no longer a bargain, as the rental car companies have found it to be a profit source. Still, I’m willing to pay the increased cost to lay off the increased risk (with greater convenience), and protect my accident record on my auto policy.

mjflack
mjflack
2 months ago
Reply to  John Wood

John Wood, thanks for the comments. The PDW/CDW insurance that the rental car company sells, will cost you $15-30/day. ($105 – $210/week). You make it sound as if this cost is insignificant. I like the idea of laying off the risk to someone else, but there must be a limit. Would you be willing to pay $50/day . . .$100?
-That being said one might think that getting the PDW/CDW insurance from the rental car company would then offer the renter the ability to “just toss them the keys because their insurance is paying for the damage”. It does not, as it does not cover liability-related expenses, such as damage to other vehicles in an at-fault accident or medical expenses in the event of a bodily injury or damage due to driving on unpaved surfaces, speeding, being negligent, or driving while drunk or theft due to negligence. You should also look at the fine print in your CDW agreement because there is a possibility that damage to tires, the windshield, mirrors, interior trim, undercarriage, gears/transmission, dead battery, or other parts are also not covered.
-You will of course need to confirm what is and isn’t covered by reviewing the fine print on the rental car contract at the rental car counter (after a five-hour flight) because that contract is what defines your coverage. Questions about the coverage? I’m sure that kid behind the counter can provide a thorough explanation of the legal definition of the word “negligent” or “undercarriage”.
-You spend $30/day and in the end, you may not be covered? Imagine purchasing auto insurance for your own car with a list (in very fine print) of exclusions?  

SanLouisKid
SanLouisKid
2 months ago

12. As a rule, don’t buy collision damage waiver coverage in the U.S.

I agree, but… I use my Amex card to rent and buy the optional “Premium Rental Car Coverage.” (Info below from the Amex website 8-21-2021.)
$100,000 of physical damage is $24.95 per rental for 42 consecutive days. I pay $24.95 one time and have coverage for the entire (up to 42 days) rental period. The coverage is primary, so you just let Amex handle the physical damage. That keeps it off your insurance company claim records.

  • Flat rate of $19.95 / $24.95 per rental period, not per day depending on your coverage selection ($15.95 / $17.95 for CA Residents; $12.25 / $15.25 for FL Residents).
  • Coverage is primary for theft and damage to a Rental Vehicle. If your rental vehicle is damaged, you can file that claim with us first as your primary provider.
  • Coverage provided is not subject to a policy deductible.
  • You pay only when you rent. Your enrolled Card Account(s) will automatically be charged when used to pay for a rental vehicle until your enrollment is terminated.
mjflack
mjflack
2 months ago
Reply to  SanLouisKid

SanLouisKid, Thanks for your comment. The “Premium Rental Car Coverage” sounds interesting. I am concerned though about the idea of now having insurance (“Premium Rental Car Coverage”), on insurance (“credit card CDW insurance”) on insurance (“my Auto insurance”).

Will
Will
2 months ago

We rented for a week at a Toyota dealer—much cheaper than a car rental company. Not all dealers rent, but check it out.

mjflack
mjflack
2 months ago
Reply to  Will

Will, thanks. I will keep it in mind for the future. Though getting from the airport to my car (and back) may upset the economics.

Olin
Olin
2 months ago

Many good tips to think about. Some of those rental car workers behind the counter can be cheesy and intimidate you to take additional add-ons. Even though your own insurance will cover you for an accident, the rental agent will tell you that you must pay for all damages upfront.

Also, consider corporate discounts that your employer might have. The company I retired from gets huge discounts any day of the week for all employees whether currently working or retired.

mjflack
mjflack
2 months ago
Reply to  Olin

Olin, thanks for your comments. I agree with you regarding the “sales associates”. A few will lie or intimidate in their efforts to sell you insurance or other add ons.

booch221
booch221
2 months ago

I use Costco to book my cars online for travel in the United States.
https://www.costcotravel.com/
Booking is easy, you enter your pick-up and drop-off location and dates.
It presents a matrix comparing the prices from Avis, Budget, Alamo, and Enterprise. It shows the total cost including taxes and airport fees, if applicable, and the Costco discount. Every car I’ve ever booked has included a second driver at no charge and all reservations have been cancelable.

When I pick up the car I ask how to disable the toll transponder. Not only will you end up paying the toll but they charge you an daily administrative fee. If you rent a car for two weeks and pay only one toll you will be charged the administrative fee for every day of the rental. I get a roll of quarters and lots of $1 and $5 dollar bills to pay any tolls with cash.

Jared Asmus
Jared Asmus
2 months ago
Reply to  booch221

You LITERALLY just saved me more than $500. I had a car rented for a trip to Maui in September that I found through Kayak and just got a better car through Costco Travel for $500 less, and that is including the $50 I had to pay to cancel the existing reservation. I don’t have to prepay and I can cancel without penalty if the trip needs to be cancelled. The Costco reservation even included a $20 Costco gift card. Thank you!

Matt McGuinness
Matt McGuinness
2 months ago
Reply to  booch221

Costco comes with other “freebees” the rental car companies love to charge for as you noted, like free extra driver (must be registered/ designated in advance). I honestly don’t know how the rental car companies make any money off of Costco members, the rates are so low compared to other booking options!! My favorite rental car hack years ago was priceline.com (where you didn’t know the name of the rental car company until after you booked), but for the last 7 years it has been Costco!!

mjflack
mjflack
2 months ago

Matt McGuinness. thanks for your comments. The free extra driver is a very nice perq. Ahhhh! Priceline.com, good times! Since rental car companies are the definition of fungible it didn’t matter who wound up renting me a car at an incredibly low daily rate!

mjflack
mjflack
2 months ago
Reply to  booch221

booch221, thanks for your comments. I’m a Costco member, so I’ll make sure to try them out next time. Good idea re: coins/bills – you need to be prepared (though many roads are going fully electronic). Many tolls in Europe are not manned, but allow the driver to swipe/insert a credit card.

Mik Cajon
Mik Cajon
2 months ago

Enterprise is the best…Hertz not so much…IMO.

mjflack
mjflack
2 months ago
Reply to  Mik Cajon

Mik Cajon, thanks for your comments. In my travels, none of them stand out.

kristinehayes2014
kristinehayes2014
2 months ago

I’ve had really good luck using the Costco car rental program. You do have to be a member to take advantage of it, but the pricing I’ve received through their program has been better than any other sites I’ve looked into. It’s even more economical if you use a Costco Citi Visa to pay for the rental. They do have a limited number of international locations available, but for domestic travel, it’s a good bet. https://clark.com/shopping-retail/warehouse-clubs/costco-car-rental/

mjflack
mjflack
2 months ago

kristinehayes2014, thanks for the feedback – Costco sounds like a very good option. I’ve updated The After Action Report: The Rental Car Protocol accordingly.

Rick Connor
Rick Connor
2 months ago

Great article. I’ve had issues with #6 – if you use the transponder, even just once, Avis charges a transponder fee for every day of the rental, even days you don’t use it. Another annoying aspect is that many of the toll charges took weeks to hit your credit card. When traveling for work, we had a short period to submit expense reports. Sometimes you wouldn’t see toll charges for a month.

mjflack
mjflack
2 months ago
Reply to  Rick Connor

Rick Connor, Thanks for your comments. I agree on the uneconomical aspects of the transponder. Also when the toll charges hit your credit card weeks/months later, you will have no idea exactly what they are for.

Guest
Guest
2 months ago

Thank you for these helpful tips Mr. Flack.
I’d like to add that you should always ask for a complimentary upgrade when renting a car (and a hotel room for that matter). When I’ve traveled with friends/family virtually all of them are too intimidated to ask the rental agent when we arrive to pick up the car. I just ask and am, more frequently than not, given the free upgrade.

Last edited 2 months ago by Guest
mjflack
mjflack
2 months ago
Reply to  Guest

Guest, thanks for your comments. That’s a great idea and I’ll try it next time. The one reservation I have is that many times I rent a compact/economy car for a reason (city driving, gas mileage, etc.) and actually do not want an upgrade.

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