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Third party liability on rental cars

I am planning to hire a car in Israel next month. Comparing rates, some include Third Party Liability while others, eg Budget, do not. I dropped rentalcars.com a line and they said "you will need to purchase Third Party Liability (USD $15/day excluding tax) at the counter.".

My understanding is this is compulsory to cover damage/injury to others if it is my fault. So how can it be that apparently similar rates (until you read the small print) are actually different, and would they really take an additional compusory charge at the counter? It is a practice which must make many people hire what they think is a cheaper - but is actually a more expensive - car.

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