When you rent a car, you are on the hook for their DEDUCTIBLE, which is usually $2,000. If you have an accident without having bought their Collision Deductible Waiver, they will put up to that $2,000 onto your credit card, whether you have insurance that will pay for it, OR even if you were hit by somebody else, whose insurance company will ultimately pay them back after which, they will refund whatever they put on your charge card.
Of course, if you have collision insurance that will pay for the damage to their car, and you are at fault, you will get your money back after your insurance company pays them, less your policy’s deductible.
Some credit cards have Collision Deductible Coverage, So if you don’t have one of those credit cards, and are just renting for one day, and don’t want the hassle, buy the rental car’s Collision Deductible Waiver (CDW). But if you are renting for a week or more. CDW is so expensive, that it doesn’t make sense, especially if your auto policy covers you an a rental!