Zipcar's insurance policy

It has been three years since I first looked into car sharing, and subsequently joining zipcar.  I thought "ziping" would replace "renting" completely, however, over these years my needs of becoming a motorist has been met by a mixture of "renting" and "ziping".  Despite the administrative overhead,  renting makes more economical sense, especially long term.  The cost of a day of ziping comes close to $80, while renting could be $10-$30 cheaper.  The downside to that are: I have to pick up the car before the rental office closes, return after it opens, and fill up the amount of gas the car consumes.

Back in 2010, when I was researching zipcar, I couldn't quite understand how zipcar's insurance  works.  Here is a section from that blog:

***Yes, the price does include insurance, but they charge you $750 damage fee, unless you sign up for a waiver which costs $5 per month.

I don't quite understand the logic behind this rule; if insurance is included in the price then what's the $750 damage fee? Let me know if you have this figured out, will you?

Recently, I was in my first accident while zipping.  I backed up into a concrete and damaged the rear bumper of the driver side.  I don't have a damage fee waiver, so I am responsible to pay the cost of repair up to $750.00.  If the repair costs more than that Zipcar pays the difference.

The short of it is that Zipcar transfers the co-pay of their insurance policy to the driver.

I don't like this at all, simply because zipcar advertises, rental fees include insurance; then orthogonal advertises the damage fee waiver.  A naive mind regards the damage fee waiver as an optional fee.

I asked the zipcar representative working on my case about this.
Question:
How is zipcar's insurance different than the rental car's? 
Upon purchase of the rental car's insurance the renter doesn't pay for any damages. The insurance covers it. Is the damage fee the insurance co-pay? If yes, shouldn't zipcar pay because the pay hour fee, per zipcar, includes insurance?

Here is his answer.
"Should a Zipcar member be involved in an accident with their reserved Zipcar, they would be responsible for a damage fee.  The damage fee works much in the same way a personal insurance policy deductible would work. For those members who are interested in reducing their current damage fee, Zipcar does damage fee waivers for an extra cost.  Eligible members can purchase one of four different waiver plans available.  Please find below a breakdown of the different waiver options currently offered:

Complete Waiver:  Reduces damage fee from $750 to $0 per incident
-    Annual: $79 one-time charge
-    Month-to-Month: $9/month

Partial Waiver: Reduces damage fee from $750 to $375 per incident
-    Annual: $50 one-time charge
-    Month-to-Month: $5/month

The Month-to-Month waiver options will auto-renew each month for a 12 month period and can be opted out of at any time.  Both the monthly damage fee waivers and the annual waivers will auto-renew at the end of the 12 month period so long as the Zipcar member remains eligible for the damage fee waiver program."