How to rent a car: the ultimate guide

This is an ultimate how to rent a car.

Renting a car can be complicated. From fees to fuel purchase options, the process is enough to confuse even the most experienced traveler. But let’s keep it simple. Here’s your ultimate guide on how to rent a car.

What you need to know before you rent a car

Here are a few things you need to know before you rent a car: Car rental companies earn almost nothing from your base rental charges. They make money by upselling you into a bigger car, persuading you to buy pricey insurance, and getting you to accept questionable extras, like fuel purchase options. Customers allege some shady car rental firms also enrich themselves by charging you for damage to the vehicle once you’ve returned it — whether you’re resonsible for it or not.

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You can rent a car from many places. Here are your choices:

Direct from the car rental agency

If you are partial to one brand, you’ll probably want to go straight to the car rental company’s website or call its toll-free number. Car rental companies will offer bonuses and other incentives to deal directly with them. You can also negotiate a discount using many membership organizations, such as AAA or AARP. The downside? You won’t be able to make an easy price comparison, and unless you’re careful, you might book a nonrefundable rate through the site.

A travel agent

A full-service agent can offer recommendations and negotiated rates that you won’t find anywhere else. If you’re uncomfortable booking online, or don’t rent cars often, this is your best choice. Bear in mind that agents get paid a commission on rentals, so they may steer you toward a company that pays a higher commission or bonus. (That doesn’t necessarily mean it’s a bad deal for you.)

Through an online travel agency

Companies like Expedia or Booking.com offer virtually every major car rental brand, as well as price guarantees that make them an attractive option when shopping for or booking a rental car. Note that as with full-service agencies, online agents sometimes display the cars that pay them the highest commissions (or exclude the companies that pay lower commissions). Don’t assume you’re getting every option with an online agency, so shop around.

From an opaque site

Sites like Priceline and Hotwire sell you prepaid, deeply discounted rentals, but you don’t find out the car rental company’s name until you book the car. The benefit? You can save between 20 and 40 percent, and the voucher you receive includes all mandatory taxes and fees. But there’s a catch: The car is totally nonrefundable. Book with any of the other methods and you can usually cancel the reservation without a penalty. Specialty vehicles and cars rented during special events may not be cancelable, either.

Locally through an independent agency

Smaller, independent car rental companies generally don’t show up on online travel sites such as Expedia, yet they can offer a competitive rate. You’ll have to do an internet search for car rental companies in the area to which you’ll be traveling, and if you’re flying into an airport, transportation to the car rental company can be a hassle. Also, you may be assigned an older rental unit. So be sure to ask questions over the phone to establish the local rental company’s modus operandi.

At your favorite big box store

Stores like Costco and Sam’s Club can offer some of the lowest prices on rental cars to members. Some of the vehicles also include insurance or can offer a discount on insurance coverage that makes the price difficult to beat.

No matter how you book your car, you’ll want to double-check the dates of your rental and the location for pickup and dropoff before pulling the trigger. If you’ve made an error, you can always fix it if you’ve booked through one of the three conventional methods. If you’re using an opaque site, it may be difficult, if not impossible, to modify your reservation. (As a general rule, the quicker you let the company know of the error, the better your chances are of getting it corrected.)

Above all, read the confirmation you get by email. Then read it again. The last thing you want is to discover a problem on the day of your trip.

Should I rent a car at the last minute?

Many car rental companies jack their rental rates up for last-minute, or “walk-up” customers. Why? Supply and demand. They have the car and you want the car. Don’t get caught at the last minute without a vehicle. Plan ahead. If you do go the last-minute route, consider booking through an “opaque” site like Hotwire or Priceline, which can offer you a reasonable (though nonrefundable) rate at the last minute.

Should I worry about car classes?

Car rental companies offer vehicle classes ranging from subcompact to luxury. These designations are about as meaningful as the star ratings used to grade hotels — which is to say they can be a general guide, but you shouldn’t give them too much weight. Instead, pay attention to the description of the car. Your car rental agreement usually doesn’t guarantee an exact car type. Any given car may be considered a “compact” by one company and “midsize” by another. Why? Because the car rental companies say so, that’s why!

How can I rent the best car for my trip?

Savvy car renters use two strategies:

Reserve the car class you think you’ll need

Most drivers do this — they consider the number of passengers, amount of luggage and their itinerary, then book the vehicle that’s best suited to them. It’s a safe strategy.

Book the smallest car and hope they run out

It’s an open secret that car rental companies often run out of subcompacts because they’re so popular (or maybe because this strategy is so popular). The accepted industry practice is to give you a car in the next available class, which can mean a free upgrade for you. This is a risky move if you have more than two passengers and lots of luggage, because the car rental company could have the vehicle you reserved. Worst-case scenario, they’ll see you need a bigger car and offer you an upgrade, or you can inquire about one yourself. In this case, you’ll have to pay for the higher vehicle class.

Is it OK to make a duplicate reservation?

Since you can make as many reservations as you want and then cancel them without a penalty, you could play one car rental company off against another. I know of some frequent business travelers who will always make a “backup” reservation just in case they can’t get the car they want, or in case the company runs out of vehicles. I take a dim view of this, and so does the industry. Not only does it mess up the car rental company’s inventory management, but it is selfish to take more than you’ll use.

A note about specialty vehicles: If you need something that’s not on the “menu” on the car rental company’s website, don’t assume that it’s not available. Some locations may carry other kinds of vehicles, but you don’t see them because the reservation system they belong to uses generic photos of vehicles as suggestions of what may be available. Solution? Get the name of the location manager, and call at least a week before your rental date. Ask what types of minivans, SUVs or trucks they have in their fleet.

What do these car rental fees mean? Do I have to pay them?

Fees are a never-ending source of frustration to travelers. But they don’t have to be.

Here are some of the fees you’re likely to encounter when you rent:

    • Taxes
      State and local taxes fund everything from schools to sports stadiums. They can add 20 percent or more to the cost of your car. They are unavoidable.
    • Airport concession charges
      These fees, usually several dollars per day, cover the car rental company’s cost of renting facilities at the airport, including the “courtesy” shuttle. Some car rental companies charge concession fees if you rent near the airport, so read your bill carefully.
    • Junk fees
      Energy recovery fees, tire disposal fees, and license recovery are among the most creative fees in the travel industry. Consumers call them something else: junk fees. They serve no other purpose than to confuse customers about the true price of the rental car.

Why taxes and fees matter

Why do car rental companies bother to add fees to your bill? They want to quote a low base rate and then add the fees afterward. Some of the charges, such as taxes, may not directly benefit the car rental company. But junk fees and concession charges allow the car rental company to quote a low base rate and then charge you more. It also lets them get out of paying some travel agent commissions, since fees are usually non-commissionable.

Do I need car rental insurance?

Yes, you do. Don’t drive a car without insurance. Ever. I shouldn’t have to tell you that, but here’s the sad reality: If you have no insurance, and anything happens to a rental vehicle while it’s in your possession, you’re responsible. And yes, car rental companies won’t hesitate to ask you to pay for a new car if you total one of theirs.

What do all these car rental insurance options mean?

Let’s take a closer look at each type of insurance.

  • Loss Damage Waiver (LDW) –- This is your basic insurance, and it normally covers the loss of the vehicle, or damage to it, and any loss of use to the rental company. A related kind of insurance, Collision Damage Waiver (CDW), is more limited, covering the car, but not injuries or damage to other property.
  • Personal Accident Insurance (PAI) — Covers you and the passengers in your car if you’re injured in an accident.
  • Personal Effects Protection (PEP) — Insures the property in the car, up to a certain amount.
  • Additional Liability Insurance (ALI) — Extra protection that covers everything from bodily injury to death to property damage.

Note that the names of these insurance policies may vary based on which company you rent from.

When should I make a decision about insurance?

The sooner, the better. Review your car insurance policy, credit card insurance and travel insurance before you leave, to see if your rental car is covered. Also, if you’re renting outside the United States, be sure that you are meeting that country’s insurance requirements — otherwise, you may be forced to buy insurance. Bottom line: Know before you go.

How do I decide which policy to buy?

You need to understand a few things about car rental insurance before you buy it. Some of these policies make perfect sense for you and are a good deal. Others are overpriced and unnecessary. Which is which? It depends on where you’re renting and who you are.

Normally, you’ll have enough coverage between your credit card insurance and personal car insurance policy, but watch out — if you’re renting a specialty vehicle like an exotic vehicle, van or SUV, or if you’re renting outside the country, your policy may not work. (Rentals in Israel, Ireland, and Jamaica are not covered by most major credit cards, and you’ll need to purchase a separate policy when you rent a car in those countries.) Read your policy and cardmember agreement before you rent. Remember, your credit card or car rental insurance may or may not cover all of the damage to a rental car. Make sure you know.

The point is, you want to avoid having to make up your mind at the counter. Car rental agents are trained to sell you insurance and other extras. They are not travel agents; they’re often evaluated based on how much insurance and other add-ons they can sell you when you pick up the car. You won’t be able to avoid the pitch, but you can manage it.

I want to do a one-way rental, but it’s too expensive. How do I save money?

You have two options. First, you may want to call several agencies to find out if they’re willing to discount their rentals. Car rental companies need to move their fleets from one part of the country to another, so if your timing is right, there’s a good chance that at least one of the major chains will offer a discount. And second, you could find out if there are any “driveaway” opportunities — car owners who want to move their vehicles from one part of the country to another and might actually pay you to drive their vehicle.

What car rental options do I really need?

The fuel purchase option

This comes in several flavors, from prepaying for a tank of gas, to paying for the fuel you consume after you return, to topping off the tank before you bring back the car. If you choose the latter option, keep your gas station receipt — you may have to show it as proof you refueled within a certain mileage radius of the rental location. The first and second options may work for you if you’re in a hurry, or on an expense account; otherwise, go for door #3. Note: Car rental companies will probably make money off any fuel purchase option unless you return the tank bone-dry.

The insurance

Look, if you haven’t done your homework before you get to the counter, and have to endure the sales pitch, complete with the images of damaged cars (yes, I’ve been there), then you owe it to yourself to buy at least a basic CDW policy. Why? Because you don’t know if you’re covered, and that means if you’re in an accident, you may have to buy a $30,000 car.

Nav systems, toll tags, and SiriusXM radio

Totally your call. You know where you’re going and what you need. If you require any of these items, then go for it. Be certain that you haven’t inadvertently opted in for a toll tag. If you do, you might pay twice for tolls. Also, some toll tagging systems bill you by the day once you start using them, whether you use a toll road or not. That’s not exactly a bargain if your car is parked in a hotel lot most of the time. And some systems tack an “administrative fee” onto the toll. If you have your own transponder at home, it might be worth it to detach it from your car (if it’s the detachable kind) and bring it along.

What’s rent a car upgrade “roulette”?

If you’re on vacation and want a nicer set of wheels, you can play something I call upgrade roulette. As part of their training, agents will try to talk you into an upgrade. What you might not know is that there could be one of two reasons: Either they want to make more money, or they don’t have any cars in the class you reserved. Either way, you’re better off saying “no.” Most car rental firms have a policy that you’ll get an upgrade for free if they run out of the class of car you have reserved.

By the way, there are times when you’ll want to turn down that upgrade. If your insurance won’t cover a more expensive specialty vehicle, or if you’re concerned with gas mileage, you may be better off downgrading and having the price adjusted.

Do I need to do anything before signing my car rental contract?

Make sure the options you asked for are on the final contract you sign. Some car rental employees have been known to “accidentally” check the option for insurance. If you sign the contract accepting it, you will be charged the full amount, and there’s usually no way to get the money back. Electronic signature pads, which may or may not display your contract adequately before you sign, have made this even trickier. Only the most ethically challenged rental agents try this cheat, but in the end you are responsible for what you’ve signed. If you don’t understand the contract (or if it’s in another language), ask an employee to explain — but remember that verbal explanations do not trump the written contract. If you’re uncomfortable with anything at all, don’t sign. Take your business elsewhere.

What should I do before I drive away?

Many car rental problems can be avoided by taking a few precautionary steps. Do you know how to operate the car? Car rental companies are now offering everything from electric vehicles to hybrids to Smart Cars (microcars), and they don’t operate the same way the standard gas-operated cars do. (Don’t believe me? Try starting a Toyota Prius without first reading the manual. Go on. I’ll wait.) This is the time to ask. Car rental employees are trained to help you get acquainted with your car. Note: This is especially important if you’re switching from a right-hand to left-hand drive vehicle, where many of the switches are reversed. At the very least, check your glove compartment to make sure the manual is there. You’ll be glad you did.

Should I take a picture of my rental car?

Absolutely! Photograph or videotape your car before you leave the rental lot. I’m not joking. Most car rental companies do not adequately document the condition of your vehicle, and only a small fraction take photos of your car before you rent it. Whip out your digital camera or smartphone, and let’s get to work.

At a bare minimum, you need shots of the front, back and sides of the car. I would recommend two close-up shots of each side, the front and rear windshield, the front and rear of the car, and the roof. Don’t forget the interior: the dashboard (showing the odometer and fuel gauge readings), front seats, back seats, and trunk. Also, make sure the license plate is visible in at least one picture, and capture the VIN placard (on the pillar behind the driver’s door or in the lower-left corner of the windshield). If you want to be extra careful, take snapshots of the wheels, under the two bumpers and roof. Believe it or not, motorists have been billed for damage that’s invisible to the naked eye at the time of the rental. You can’t be too careful.

It’s impossible to over-photograph or videotape your rental car

Note: If you’re in a garage with low light, drive the car somewhere in the parking area that’s well-lighted to conduct your visual inspection. Do not leave the rental lot without taking these pictures. Repeat: Take pictures before you leave.

It is impossible to over-photograph or videotape the car. By the way, if you are videotaping, hold the camera steady, and make sure it’s set to the highest resolution. If you’re shooting still images, and you have the option to timestamp the photos, make sure that function is activated on your camera.

Download your photos, and then upload them into the cloud for safekeeping. How long should you keep these photos? At least six months after your rental. That’s the longest I’ve seen a car rental company wait to file a damage claim. After that, feel free to delete these files.

Your car rental company should furnish you with a form where you can note the condition of the vehicle. The form allows you to identify any problems on a diagram of a car. Record any pre-existing damage on this form, and make sure a car rental employee signs it. Don’t, under any circumstances, leave without a copy of the signed form.

What if I see a ding, dent or crack?

If you spot a scratch or dent while you’re photographing the vehicle, tell an attendant. You will either need to document the damage in writing or ask for a different vehicle. Don’t let anyone tell you that a dent or scratch “the size of a golf ball or smaller” doesn’t count. Everything counts. My personal advice is that if the car is dirty and/or has large dents, you need to ask for another one. Not because you’re picky, but because the car rental company could hold you accountable for those dents later on. Also, scratches and other imperfections are difficult to see when the car isn’t clean. If you need to take a flawed vehicle, be extra vigilant about noting the damage on your form. Again, make sure an employee signs off on it.

Other reasons to reject your rental:

  • It’s not the car you reserved — the one described on the contract.
  • It appears unsafe to drive (balding tires, lights don’t work).
  • If it smells bad.
  • Registration or safety inspection is expired, or will expire during your rental (don’t forget to check).
  • High mileage (over 50,000 miles).
  • Chipped windshield. You should have zero tolerance for anything irregular on the front or back windshield.
  • Something feels off. After driving off the lot, don’t be afraid to return if you feel the car is not driving properly.
  • Wrong color. (I’m kidding.)

How about the sign-off?

Before you leave the airport car rental lot, you’ll pass through a checkpoint where your rental agreement and driver’s license will be checked by an employee. So, don’t put those away just yet (I usually leave them on the seat next to me, for easy access.) This last check is yet another opportunity to make sure your car is what it should be. Don’t be shy about getting out of the car for another inspection. Walk around the vehicle and mention to the employee if something looks wrong. Remember, this is your last chance.

These procedures will vary if you’re renting from a non-airport location. For example, there won’t be a gate, and pickups and returns may be handled differently, but the same principles apply: Know how to operate your vehicle, and make sure you photograph it and document any damage.

I’ve put a dent in my rental vehicle. Now what?

This is a hugely controversial issue. Many travelers believe car rental companies are profiting from damage claims by charging them for scratches or dents that were either pre-existing or completely fictional. Car rental companies are faced with hundreds of millions of dollars in damage expenses every year, and the companies say they are just pursuing the customers who damage their vehicles.

If you get a bill from the rental company for damage to the car, first check your “before” and “after” photos. If the damage shows on the “before” photos, you should have brought it to the attention of an employee before leaving the lot, but you still have some ammunition — assuming your photos are dated- and timestamped.

But if the damage is on the “after” photos, but not the “before,” you probably won’t be able to get out of paying. But ask for some backup from the rental company:

  • Documentation of when the company discovered the damage; and the odometer reading at that time;
  • A written repair estimate;
  • If the bill includes a charge for “loss of use,” demand to see the average daily revenue over the last year for a vehicle in that class at that rental location;
  • If the bill includes an administrative charge, be prepared to argue that the charge is excessive.

What about other types of damage, like the kind caused by weather or wear and tear?

Increasingly, car rental companies are taking a hard line on other damage. For example, if you’re renting a car in Denver during the summer, there’s a chance you’ll run into a hailstorm and receive a bill for hail damage to your vehicle. If your vehicle has a flat tire, the rent a car agency will ask you to pay for a new tire and the installation cost. Insurance won’t always cover this damage, and often, the rental company will charge your card directly for the damage and let you work it out with your insurance company — if you can.

What are the steps of a claim?

Ideally, the car rental claims process will start when you return a damaged vehicle. An employee will ask you to fill out a claim form in which you acknowledge the damage, and explicitly agree to pay for it.

Recently, some rental companies have begun charging a deductible to a renter’s credit card even when there’s been no formal damage estimate. I’m skeptical of that practice. While it may be legal, I think you’re better off waiting for a bill before paying up or asking your insurance to settle the claim.

If you purchased the optional insurance, you’re all done. You shouldn’t have to worry about anything else. But if you’re using your own insurance or, God forbid, you don’t have insurance, you’re not out of the woods yet. You’re going to have to deal with your car insurance agency or credit card company quickly (there’s a time limit on filing a claim), and then negotiate with the car rental company or an outside company that specializes in damage claims (often referred to as a subrogation management company).

What should I do when I return my vehicle?

A vast majority of disputed car rental damage claims happen because of little dings and dents that no one noticed before you drove off the lot. Maybe you were parked at the mall, and the SUV next to you put a little bump in your side panel when the driver opened his door. The trick is to identify any minor damage when you return your set of wheels to the rental location. You’ll want to give yourself 10 extra minutes to walk through these steps. Believe me, they’re worth it.

  1. Find a bright space, preferably out in the open.
    Whip out your camera, and photograph the inside and outside of the vehicle. Take as many images as possible. Note any dings, dents or scratches. Pay close attention to the windshield; that area is the number one source of damage claims. (Essentially, you should repeat the entire process you went through at pickup, including shots of the license plate, VIN, and instrument panel, showing mileage and fuel level.)
  2. Ask the car rental employee handling your return to walk around the car with you.
    They will often be busy (tell them you can wait), or totally unavailable (see step 3). Walk around the car with the form you filled out when you rented the car, and then ask the employee to sign the form, or give you something else in writing verifying that you returned the car in the same shape as you drove it away. If the employee says a printed receipt is sufficient, then at least note the name of the worker who assured you the receipt was sufficient. You may need it later in the event of a dispute.
  3. If no one is available, go inside.
    Ask for the name and email address of the branch manager, and send the manager a brief email with your name, rental number, and a few snapshots of the car as you returned it. Is that overkill? No, and especially not if you are using your own insurance, as opposed to the optional Collision Damage Waiver offered by the rental company. It signals to the rental location that filing a frivolous claim against you will be difficult.
  4. Keep your photos, video, receipts and signed documents for at least six months. That’s how long it could take a potential claims process to play out.

How do I dispute a damage claim on my car rental?

In some cases, a car rental company will discover damage to a vehicle after you’ve returned your car. If you’ve gone through the process of photographing your car, and getting a signoff from a real person, then this is a non-issue. Simply send your extensive documentation back to the claims department, and that should close your case.

What if you forgot to take pictures, and simply dashed off to the airport terminal? (Hey, it happens.) Well, there’s a way out of that, too.

Note: If you think there’s a chance the car was damaged while you had it, and a car rental company can show you credible documentation to that effect, then I would urge you to accept responsibility for the bill. Car rental customers sometimes say they shouldn’t be held responsible if they were not at fault in an accident or fender-bender. That’s incorrect. If anything damaged the car while you had it, you have to pay for the repair.

The bad news: You damaged your rent a car

First, the bad news. You’ll get a damage alert from either the car rental company or a claims management company, via email or letter. This can be unsettling because it often doesn’t contain many details. This initial document will usually only inform you of the problem. The company will ask for your credit card information and/or your insurance information.

Next, the proof. The company will send an email or letter that contains photos of the damaged car and a repair estimate. It could also contain two fees unrelated to the repair: loss of use, and diminishment of value. These fees are exactly what they say:

  1. An estimate of how many days the car was out of commission and the average daily rate it might have earned; and
  2. An estimate of how much less the car is worth, now that it’s been banged up.

Read everything carefully. Make sure the license plate matches the plate on your rental and that it’s the same car. (Sometimes, it’s not.)

Lastly — pay up… or else. If you don’t respond to the first or second letter, the company will threaten to refer your case to a collections agency. This is probably the last time you’ll hear from the car rental agency directly. It’s also your last opportunity to come to an agreement. By the way, if you don’t respond, you won’t just have a collections agency harassing you, the agency will also blacklisted you from ever renting again.

What are some strategies for disputing a claim?

Again, assuming you are absolutely certain that you returned your car rental undamaged, here are the steps.

  • Politely tell them you didn’t do it.
    You should do this in writing, not by phone. Resist the urge to get an immediate resolution. The process takes time. Be as detailed as you can in your explanation, but keep your initial letter tight. The car rental companies reject most of these rebuttals, but they are a necessary part of the claims process. Bottom line: you’ll need to get your denial on the record.
  • If you do receive a denial, send a more strongly worded email to the car rental company, restating your position.
    Ask for written proof of the damage. Copy your insurance company. By now, you should have received a repair estimate. Feel free to challenge some of the items, including loss of use, and diminishment charges. Repair bills often contain these inflated fees. With a little prodding, I’ve seen these charges lowered or even removed.
  • If that doesn’t work, appeal your case to the executive level
    Next, I would recommend deploying the problem-solving escalation strategies detailed in my article on the topic. Appeal your case to a manager, a customer-service vice president, or the CEO of the car rental company. You might want to loop in your attorney and the insurance commissioner in the state in which you rented the car. I’ve spoken with damage claim companies who say if the damage is less than $500, they’ll often drop the claim at this point.

But if none of those strategies work, call me.

I think the claim I’ve received from the car rental agency is a scam. What should I do?

Your scam radar should be on full alert if you see any of the following.

  • A claim that’s a few dollars short of $500, which is the standard car insurance deductible. This may be a sign that the car rental company is trying to ding you for a trumped-up damage claim. It doesn’t want to go over $500, and invite the scrutiny of an insurance company.
  • A damage claim for normal wear and tear. If an essential part of the vehicle stopped working because of a maintenance problem, then it’s not your fault. A car rental company is responsible for changing its vehicles’ oil, and keeping the fluid levels where they should be.
  • Damage to a part of the car that’s unseen to a normal person. That would include the roof and the undercarriage. Almost no one checks the roof before they rent a car, and no one crawls under the car. It’s really their word against yours that something happened.
  • A cleaning fee for smoking or pets. That’s especially true if you don’t smoke or didn’t bring your dog or cat on your trip.

If you’ve already appealed to the highest level at the car rental agency, please contact my advocacy team for help.

Can I ask for an independent review of the repair bill?

Generally, the answer is “no.”

Car rental companies don’t bother themselves with second opinions while processing thousands of claims. But don’t let that stop you from questioning the bill. You should do your own research to determine if the rental agency is correctly billing you.

You may be able to contact your state Attorney General to ask for help, since car rental companies are regulated at the state level.

What about moving violations on my rent a car?

If you’ve run through a tollbooth or a red light, there’s nothing you can do at this point. Your car rental company will forward the paperwork to you. In many cases, the company will furnish you with photos that establish your guilt. At the very least, it should document the time and place of the alleged violation. Review this information carefully. I’ve dealt with many tickets where the driver was out of state. These drivers couldn’t have possibly run the red light, or where the wrong car was billed for a moving violation.

How do I contact someone higher up at a car rental company?

We list all of the names, numbers and email addresses of the car rental company executives on this site.

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