Do I Need Personal Accident Insurance When Renting a Car?

You’re standing at the rental car company counter. You’ve just signed for a compact SUV for the weekend. Then comes the real question — not about fuel or mileage, but car rental insurance options. The rental agent asks if you’d like to purchase personal accident insurance (PAI).

It sounds important. But is it necessary?

If you’ve never been in a situation where you need to purchase rental car insurance, it’s easy to feel unsure — especially when the pressure’s on, and you’re already in travel mode. This article will help you understand what personal accident insurance actually covers, when it might be worth considering, and whether you’re already covered elsewhere.

And yes, this applies directly to renters in Ontario. Under the Insurance Act, R.S.O. 1990, certain protections exist — but they don’t cover everything. Knowing what gaps remain is key to making a smart, informed decision.

Personal accident insurance is coverage designed to pay out if the driver or passengers are injured — or worse — in an accident during the rental period. Think of it as a short-term add-on that covers medical expenses, emergency ambulance services, accidental death or dismemberment benefits. 

It’s different from other forms of rental car insurance coverage, like:

• Collision Damage Waiver (CDW): covers damage to the vehicle itself
• Supplemental Liability Insurance: covers damage you cause to others
• Personal Effects Coverage (PEC): covers theft or damage to belongings inside the vehicle

PAI focuses purely on you, not the car or other vehicles. And at face value, it sounds like a responsible choice — especially if you’re planning a long drive or heading somewhere unfamiliar.

But it’s not always needed.

Many Ontario drivers already have insurance coverage in place that overlaps with what PAI offers. The key is knowing where to look.

If you have a personal auto policy, it may include accident benefits that follow you even when you’re driving a rental vehicle — especially in Ontario, where most policies cover “non-owned automobiles.” Accident benefits typically include coverage for medical expenses, income replacement, and even attendant care.

But there are limitations. Your policy may not match the exact benefits PAI offers, and the limits might not be high enough to make you feel fully protected — especially if you don’t have optional enhancements or long-term disability insurance coverage.

Some credit cards offer rental car insurance — but with major caveats. Coverage usually applies only if you use that card to pay for the rental in full and decline the rental agency’s own coverage. Also, most credit card plans focus on collision or loss damage, not personal accident protection.

That said, a few premium cards do offer accident benefits, but the coverage limits can be low or restrictive. Always check your credit card provider’s policy in writing — don’t rely on assumptions.

If you’re traveling, your travel insurance policy might already provide emergency medical coverage. This often overlaps with PAI, but may exclude rental vehicle accidents or require you to pay out-of-pocket and get reimbursed later.

Still, if you’ve purchased travel insurance recently, it’s worth reviewing what’s included.

PAI might make sense if you don’t have personal auto insurance, are traveling with others, or feel uncertain about your current coverage. It’s less about what’s legally required and more about whether you’d feel financially vulnerable in the event of an accident.

Important to note — PAI doesn’t replace all insurance needs. It does not:

• Cover damage to the rental vehicle (you’d need CDW or LDW)
• Cover damage you cause to others (liability coverage)
• Cover lost wages over the long term
• Cover damage to personal property unless paired with PEC

In short, it won’t protect you from being sued, nor will it pay to fix the rental car if you’re at fault. That’s why some renters bundle PAI with other products at the rental car counter. Others bring coverage with them, through a mix of personal insurance and travel protection.

If you’re unsure whether your existing insurance policies provide adequate coverage, a Personal Injury Lawyer can help you review your situation — especially if you’ve been injured in an accident involving a rental.

Ontario’s Insurance Act sets out minimum coverage requirements, including statutory accident benefits and third-party liability. But those legal minimums may not provide the full financial protection needed after a serious injury or accident — particularly when renting a car. That’s especially true in cases involving extended recovery, costly medical care, or the need for life and critical illness insurance.

Keep in mind, rental companies aren’t legally required to educate you about your own insurance. Their job is to offer optional protections. It’s up to you to know what you’re already covered for — and what’s missing.

The Act is designed to ensure base-level safety. It doesn’t eliminate the need for critical thinking when it comes to your unique needs.

It depends entirely on your existing insurance coverage and your comfort with risk. If your auto policy includes strong accident benefits, PAI may be unnecessary. But if you don’t have coverage—or it’s minimal—it can offer a meaningful layer of protection, especially when traveling or renting outside your comfort zone.

At DWA Law, we help Ontarians navigate complex questions every day. From denied accident benefits to personal injury claims, our team brings clarity, experience, and real legal support when you need it most.

We’re not here to upsell. We’re here to protect your rights. If you’ve been in a rental car accident or you’re simply trying to make an informed decision, a quick conversation with one of our personal injury lawyers can make a real difference. You’ll leave knowing exactly where you stand—and what to do next.

Long-Term Disability Insurance – https://dwalaw.ca/disability-lawyer/

Life And Critical Illness Insurance – https://dwalaw.ca/personal-injury/