Quick Summary:
- Check whether your policy covers US rentals and Texas liability limits.
- Understand what the rental company’s basic liability includes and excludes.
- Choose CDW/LDW if you want protection for rental car damage.
- Use a credit card benefit only if it covers rentals in Texas.
Hiring a car in Texas can feel straightforward until you reach the insurance section at the counter or checkout. The United States does not have one single, uniform rental insurance standard, and Texas rules on minimum liability cover interact with what rental companies include by default, what your own insurer provides, and what your credit card might offer.
This guide explains, in plain terms, what insurance you may need for a rental car in Texas, what is commonly offered, and how to decide what to accept or decline. The aim is not to sell extra cover, but to help you understand the risk you are taking on when you drive in Houston, Dallas, Austin, or beyond.
If you are comparing car hire options arriving into Houston, it can help to start with the pickup point details and supplier choices, for example car hire at Houston IAH or supplier pages such as Thrifty car hire at Houston IAH. For Dallas arrivals, see Payless car rental at Dallas DFW. These pages help you confirm the location, supplier, and typical inclusions before thinking about insurance choices.
Start with the key question: what are you trying to insure?
Rental car insurance is usually a bundle of different protections, not one product. In Texas, as elsewhere in the US, the big categories are:
1) Liability to other people, this covers injury or property damage you cause to others while driving. It does not repair the rental car itself.
2) Damage to the rental car, often sold as a waiver rather than insurance, typically called Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW). This relates to the cost of repairing or replacing the rental vehicle, plus potential extra fees.
3) Medical and personal effects cover, sometimes offered as Personal Accident Insurance (PAI) and Personal Effects Coverage (PEC). These can overlap with travel insurance.
4) Roadside assistance, sometimes sold as a separate add on, which can cover tyre issues, lockouts, towing, or jump starts, depending on terms.
When deciding what you “need”, separate what is legally required (liability) from what is financially prudent (damage cover, medical cover, and extras).
Texas minimum liability, what the law requires
Texas requires drivers to have minimum liability insurance. The commonly cited minimum is 30/60/25, meaning up to $30,000 for injury per person, $60,000 total injury per accident, and $25,000 for property damage. These numbers can be quickly exceeded in a serious collision, particularly with medical costs.
For rental cars, the rental company must ensure the vehicle is covered to meet minimum financial responsibility requirements. However, what you should check is whether the included liability is only the minimum, and whether it covers you as an authorised driver under the rental agreement.
If you are used to UK cover levels, Texas minimum liability can feel low. That is why many renters consider buying supplemental liability insurance, sometimes called SLI or LIS, to increase liability limits.
What the rental company usually includes by default
In the US, it is common that a basic level of liability protection is included because the vehicle owner must meet state requirements. Still, inclusions vary by supplier, booking channel, and rate type. You should confirm in your rental terms whether liability is included, what limits apply, and whether there are exclusions that matter to you.
Key points to verify in your documents:
Who is covered, only the named renter and authorised additional drivers are typically insured.
Where you can drive, crossing state lines is often allowed, but always confirm if you plan long drives.
What is excluded, breaches of the rental agreement, such as unauthorised drivers, impaired driving, or prohibited roads, can void cover.
Even when liability is included, it may not protect you from claims above the minimum. That is where supplemental liability products come in.
Do you need supplemental liability (SLI/LIS) in Texas?
Supplemental Liability Insurance generally increases the third party liability limits beyond the state minimum. Whether you need it depends on your risk tolerance and what other coverage you already have.
You may want SLI/LIS if:
You do not have a US auto insurance policy that follows you into rental cars.
You are travelling from abroad and your UK policy does not cover you in the US.
You want higher limits because Texas minimums may be insufficient after a serious accident.
You may not need it if:
You have a US personal auto policy with high liability limits that extends to rentals.
Your employer covers you under a business auto policy, but confirm in writing.
Important nuance: some travel insurance policies include personal liability, but often exclude motor vehicles. Do not assume travel insurance replaces SLI.
CDW/LDW, the cover people confuse with “insurance”
CDW or LDW usually relates to damage to the rental car itself, theft, and loss of use. It is often a waiver, meaning the rental company agrees to waive some or all charges if the vehicle is damaged, provided you followed the agreement.
Without CDW/LDW, you can be responsible for:
Repair costs up to the vehicle value.
Towing and storage after an incident.
Administrative fees charged by the rental company.
Loss of use, the income the rental firm claims while the car is unavailable.
Diminution of value, the claimed reduction in resale value after repairs.
This is why many renters in Texas choose CDW/LDW even if it is optional. Texas driving includes long distances, high speed motorways, and large vehicles, and a minor incident can become expensive quickly.
Will my credit card cover the rental car in Texas?
Some credit cards offer rental vehicle cover, but it is not universal and terms vary widely. If your card provides cover, it usually applies to damage or theft of the rental car, not third party liability. That means you may still need liability protection.
Before relying on a card benefit, check:
Is it primary or secondary? Secondary cover pays after any other insurance, and may involve more paperwork.
Does it cover the US and Texas? Some cards exclude certain countries or vehicle types.
What vehicles are excluded? Large SUVs, vans, luxury models, and pickups may be excluded.
What duration is covered? There may be a maximum rental period.
Do you have to decline CDW? Many card policies require you to decline the rental company waiver.
What fees are excluded? Loss of use and diminution of value may not be covered.
If you are unsure, the safest approach is to treat credit card cover as a potential benefit rather than your whole plan.
Does my UK car insurance cover car hire in Texas?
UK car insurance rarely extends to driving in the US, and even when it does, it can be limited. If you have a policy that includes international cover, verify that it explicitly includes the United States and includes rental vehicles. Many UK policies focus on Europe, not North America.
Because of this, visitors to Texas often end up using a mix of rental company cover, travel insurance medical cover, and possibly credit card damage protection. The right mix depends on your circumstances, but avoid assuming your UK cover handles Texas car hire without written confirmation.
Personal Accident Insurance (PAI) and personal items cover, do you need them?
PAI generally provides limited benefits for medical costs or accidental death for the driver and passengers. PEC covers theft of personal items from the vehicle, within policy limits and conditions.
You may already have similar cover through:
Travel insurance, which may include medical expenses and baggage cover.
Private health insurance, if you are a US resident or have international health cover.
However, the US is expensive for healthcare, and travel insurance is not always generous. If you have gaps in medical cover, you might consider PAI, but compare it against your travel insurance benefits and excess.
What about roadside assistance?
Roadside products vary. Some rentals already include basic roadside support for mechanical breakdowns, while optional plans extend coverage to tyre damage, lockouts, and towing caused by user error. Texas highways can be unforgiving in extreme heat, and distances between services can be significant outside cities.
If you are comfortable handling minor issues and have support via your insurer, card, or travel provider, you may not need to pay extra. If you want predictable costs and help for common mishaps, roadside assistance may be worth considering, particularly on long road trips.
How to decide, a simple checklist for Texas
Use this practical approach before you pick up the keys:
Step 1: Confirm liability. Ensure you have at least state minimum liability through the rental, and decide whether you want higher limits via SLI/LIS.
Step 2: Decide on rental car damage risk. If you cannot comfortably absorb a large bill, consider CDW/LDW or verify robust alternative protection.
Step 3: Validate any credit card cover. Confirm eligibility, vehicle class, exclusions, and whether loss of use is covered.
Step 4: Review medical and belongings cover. Compare PAI/PEC against your travel insurance and personal policies.
Step 5: Read the main exclusions. Insurance or waivers often fail when the rental agreement is breached.
If you are comparing suppliers and inclusions for US travel beyond Texas, it can be useful to review other Hola pages to understand how airport locations operate, such as car rental at Atlanta ATL or car hire in downtown Miami. The insurance principles remain similar, but local driving conditions and supplier processes may differ.
Common misunderstandings that cost renters money
Thinking liability and CDW are the same. Liability covers others, CDW/LDW addresses the rental car itself.
Assuming “full coverage” exists. There is usually no single product that covers every situation without conditions.
Ignoring authorised driver rules. If someone not listed drives, coverage may be invalid.
Not checking deposit and excess details. Even with a waiver, there may be an excess, and a hold on your card can be substantial.
Forgetting about extra fees. Loss of use and admin charges can matter as much as the repair bill.
FAQ
Do I legally need insurance to rent a car in Texas? Yes. Texas requires minimum liability coverage, and the rental company provides a way to meet that requirement. What you must decide is whether you need higher liability limits and damage protection.
Is CDW/LDW required for car hire in Texas? It is usually optional, but it can significantly reduce your financial exposure if the rental car is damaged or stolen. Without it, you may owe repair costs and related fees.
Does my credit card cover liability if I crash in Texas? Typically no. Most credit card rental benefits focus on damage or theft of the rental vehicle, not third party injury or property damage. Check your card’s policy wording to be sure.
Should I buy Supplemental Liability Insurance in Texas? Consider it if you do not have a US auto policy with high limits, or if you want more protection than Texas minimums. It is particularly relevant because accident costs can exceed minimum limits quickly.
Will travel insurance replace rental car insurance in Texas? Not entirely. Travel insurance may cover medical bills and sometimes belongings, but it commonly excludes motor liability and may not cover damage to the rental car. Treat it as a complement, not a substitute.
