My brother-in-law and his family are visiting us from Alaska and have rented a car for a couple of weeks. He asked me if I thought he should buy the rental company's Collision Damage Waiver (CDW).
His insurance policy would cover him for any car he drives in the U.S. or Canada, including the one he rented for this vacation. So I told him that he doesn't need to buy the CDW to replace any "lost" insurance from his own policy.
But I did recommend that he buy the CDW because of what the rental contracts typically commit renters to in the case of an accident. If you get out your magnifying glass and hold the rental agreement up to the light you'll see that in many cases they will hold you accountable for certain expenses and costs NOT covered by your insurance. Things like lost rental revenue, diminished value, etc. These are typically not covered by personal auto policies, but are things that rental car companies will expect you to pay for.
So my recommendation that he buy the CDW is not because of any deficiency of his auto insurance, but because of the financial commitment he's made to the rental car company for things that his insurance will not pay for.
