When Renting Makes Sense
A car rental is a short-term hire of a vehicle, from a few hours to a few weeks. It works best when you need a car occasionally or temporarily and do not want the commitment of owning one.
Typical situations include:
- Traveling to a city where you do not have a car.
- Needing a larger vehicle for a trip, a move or a family visit.
- Having your own car in the shop after a breakdown or an accident.
- Wanting to try a type of vehicle, such as an electric vehicle, for a few days before committing to one.
- Not owning a car at all, and needing one a handful of times a year.
Because you only pay while you use the car, renting avoids the ongoing costs of ownership such as depreciation, insurance, registration and maintenance.
The Advantages
No long-term commitment. You return the car when you are done. Nothing to sell, store or maintain.
Flexibility in vehicle type. You can choose a vehicle that suits each trip: a small car for city driving, a larger one for luggage.
Someone else handles maintenance. If the rental car has a mechanical problem, the company is generally responsible for dealing with it. Many rentals also include some form of roadside assistance, though you should confirm what is covered.
Newer vehicles. Rental fleets are often relatively recent, which can mean modern features and fewer breakdowns, though this varies.
The Disadvantages
It becomes costly for frequent use. Daily rates add up. If you need a car most days, ownership, leasing or another option may cost less over time. Comparing it with the full ownership costs of your situation is the only reliable way to tell.
Fees can add up. The advertised daily rate is often not the final price.
Unfamiliar vehicles. Controls, size and visibility differ between cars, so take a few minutes to adjust mirrors and seat and learn the lights and wipers before leaving the lot.
Restrictions. Some companies limit mileage, travel across borders, or additional drivers, and some restrict younger drivers or charge more for them.
Availability. Popular times and locations may sell out or cost more.
Fees to Read For
The details vary by company and place, but common items include:
- Taxes and airport or location surcharges. Renting at an airport is often more expensive than at a neighborhood branch.
- Young or senior driver fees. Charged in some places depending on age.
- Additional driver fees. For anyone else who may drive.
- Mileage limits. Some rentals have a daily cap with charges beyond it, while others are unlimited.
- One-way fees. For returning the car to a different location.
- Fuel policy. Some require you to return the car with a full tank, while others let you prepay for fuel. Prepaying is often more expensive unless you return the tank nearly empty, so compare it with refueling yourself.
- Tolls and parking. Some companies add administration fees for tolls handled through an electronic device. The wider topic of parking, tolls and other hidden running costs applies to rentals as well.
- Late return charges. Returning even a little late can cost an extra period.
- Cleaning and damage fees. Charged if the car is returned dirty or damaged.
Read the rental agreement, or at least the summary, before signing. If something is unclear, ask for it to be explained.
Insurance Questions at the Counter
This is the part many renters find confusing. The counter agent may offer several forms of cover. What is available and what is required varies by country and state, so check the details for your destination.
Before you travel, find out:
- What your own car insurance covers. Some policies extend to rental cars, and some do not or limit it to certain countries or types of rental. Ask your insurer.
- What your credit card offers. Some cards provide rental car cover if you pay with them and decline the company’s version, but terms differ and often have exclusions. Read your card’s terms or ask the issuer.
- What the rental company’s cover includes. Damage waivers, liability cover, personal accident cover and theft cover are separate items. Ask which are included in the quoted price and which are optional.
- What the insurance deductible or excess is. This is the amount you pay if the car is damaged, and it can be significant even with some forms of cover.
- Exclusions. Unpaved roads, certain vehicle types and unauthorized drivers are common exclusions.
Do not feel pressured at the counter. If you are unsure, ask the agent to put the details in writing, and take your time. Decide on your cover before you arrive if you can.
Protect Yourself at Pickup and Return
Before driving away, walk around the car with the agent or on your own and photograph or video every scratch, dent and mark, including the interior. Make sure existing damage is noted on the paperwork. Check the fuel level, the tires and that the lights work. Keep your copies of everything.
At return, take photos again, keep the fuel receipt if you refueled, and get a signed confirmation or a receipt that the car was returned in good condition. Keep the paperwork for a few months in case a charge appears later.
Rental Versus Owning
A rough rule of thought is to compare the cost of renting for the days you actually need a car against the yearly cost of owning one, including depreciation, insurance, fuel and upkeep. For someone who drives a few days a year, renting often wins, and for someone who drives daily, owning usually does. The middle ground is where the answer depends on your numbers, and car sharing, covered in its own article, can also be an option.
Rental rules and prices differ widely, so treat this as a general guide and read the agreement in front of you.