Clark Howard: Be on the lookout for hidden rental car fees

Consumer expert Clark Howard’s column appears here each Thursday in conjunction with Deal Spotter, a weekly print section in The Atlanta Journal-Constitution.

Listen to Clark's live radio show 8-10 p.m. weekdays on AM750 and 95.5FM News/Talk WSB.

Listen to Clark's live radio show 8-10 p.m. weekdays on AM750 and 95.5FM News/Talk WSB.

Many people only rent cars about twice a year, once during a summer vacation and once during the Thanksgiving or Christmas holidays. That leaves a lot of unsuspecting motorists open to common rip-off fees that the car-rental agencies like to push.

Before you take your trip, be sure to find out if your auto insurer covers you for temporary use of a rental car. That should always be your first line of defense against the most common rip-off called collision damage waiver.

When you’re at the rental counter, you will probably be warned about the consequences of not accepting the waiver, or CDW, also known by the codes LDW or PDW. Certain credit cards will provide this coverage and allow you to decline the CDW as an add-on. Check with your individual credit card issuer for further details.

If you rent a car more than six times a year, consider a Diner’s Club card. The card does have an annual fee, but it is the only one I know that serves as primary — not secondary — insurance coverage.

On the question of gasoline, you’ll very often be asked if you want to prepay for a tank of fuel. Always decline to prepay, and always fill up the car yourself before you turn it back in. If you choose to prepay, you may be charged two or three times more in service charges than the going rate of gasoline.

In addition, some rental companies are now pushing a daily roadside assistance fee of approximately $5 each day. If the vehicle breaks down on the road, many companies won’t help you unless you purchase this coverage. However, if you have a car for 10 days or longer, you’d probably be better off with a simple AAA membership that will cover you in your regular vehicle for the entire year.

Watch those fees like a hawk!

Find more answers to your consumer questions at Clark’s website. And get more savings tips from Clark’s previous blog posts.

– Clark Howard — Save More, Spend Less, Avoid Rip-offs — for the Atlanta Bargain Hunter blog

5 comments Add your comment

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Val Zakermen

November 15th, 2012
1:07 pm

Keep in mind, your auto insurer will only cover the value of the vehicle you own. Meaning that if you own a vehicle that is worth $10,000 and you rent a car that is valued at $35,000 you will be responsible for the difference in value. So if you get into an accident and total the car, your insurance will only pay $10,000 and you are left with a $25,000 bill. Also think about your deductible, $250-$500, that is would be an out of pocket expense if any damage happened. With LDW you would pay on average $45 total and not have to worry about paying a deductibles. Furthermore there will not be any increase your insurance premiums. So taking the LDW isn’t always a bad thing.

Jon Simms

November 15th, 2012
2:47 pm

I am in a rental car almost every week. Accepting the fuel option (tank up front) is a great choice in time of quickly increasing gas price, a few weeks ago in CA the price of gas moved up about a dollar/gal during my visit, and since I bought the gas up front it saved me huge! Plus the prepaid option is generally within a few pennies of the current local price, if you don’t top it up when you declined the pre purchase option is when you will pay dearly for fuel. On the damage waivers – check with your insurance to see if they cover ‘loss of use’, the rental companies will bill you for lost revenue for the time it takes to repair the damaged car.

OldTImer

November 15th, 2012
9:48 pm

The previous two posters obviously work for the rental car industry.

jim

November 21st, 2012
6:27 pm

you used to be good, please please come up with some good stuff.