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WAIVE THE COLLISION DAMAGE WAIVER?

A Collision Damage Waiver (CDW), in states that allow it, is an optional charge of $9 to $13 a day. Rental car agents may urge you to buy this option. Although they call it "collision damage" coverage, it's not technically collision insurance. Rather, it's a "guarantee" that the rental company will pay for damages to your rented car. By declining the waiver, you accept responsibility for any damages. However, under CDW, the company won't pay for bodily injuries or damages to your personal property. If you do not buy CDW coverage or are not covered by your personal auto insurance policy, you could be liable for the full value of the car. Some rental companies may hold you liable only for the first $1,000 or $2,000.

Some CDWs exclude coverage under certain circumstances. So, coverage may be revoked if you damage the car when driving it in a negligent manner, on unpaved roads, or out of the state in which you rented the vehicle. Some companies void their CDW coverage if a driver drinks alcohol or if a non-authorized driver operates the car.

The coverage offered by rental car companies may duplicate insurance you have through your auto and homeowner's policies. Coverage under your medical plan would offer protection that CDW coverage lacks. Read your insurance policies and medical plan for specifics. If you're not sure about the coverage, call your insurers. If you're traveling on business, your employer may have insurance that covers you. Also, some credit card companies and motor clubs provide members with free rental protection when you use their cards to pay for rentals.

In addition to CDW coverage, a rental car company also may offer:

• Personal Accident Insurance (PAI) - pays a death benefit and a portion of your medical expenses if you're in an accident
• Personal Effects Coverage (PEC) or Personal Effects Protection - safeguards your luggage against damage. If your homeowner's policy covers your luggage and other belongings while you travel, you may not need this protection

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