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Do I Need Rental Car Reimbursement Coverage?

By March 6, 2014 October 2nd, 2018 Auto Insurance

You drive to and from work every day. You take your kids to the ballgame. You go shopping. Have you ever wondered if your car were in an accident, how you would be able to survive without a car? We have the answer. It’s Rental Car Reimbursement Coverage to the rescue. The good thing about car insurance is that you can buy a number of endorsements for additional protections and rental car reimbursement is one of them.

What Is Rental Car Reimbursement Coverage?

Rental reimbursement provides financial protection for you if you need a vehicle when your car is damaged in an accident covered by your Comprehensive or Collision coverage. Some policies cover car rentals when your vehicle undergoes mechanical repairs. Rental reimbursement is generally available only with policies that include collision and comprehensive coverage.

How Do I Know If I Purchased the Coverage on My Car Insurance Policy?

The first several pages of your insurance policy are called the declarations pages. These pages contain the declarations of the coverages you have purchased for each of your vehicles and include the specific description of your vehicle(s). Look for a line item listed as “Rental” or “Extended Transportation,” with a dollar amount listed to the side of it. You have purchased this insurance only if there is a dollar coverage amount next to it and there is a policy premium amount listed for the insured vehicle. You may purchase the coverage for one vehicle but not for another, at your option.

How Rental Car Reimbursement Works

The optional rider offsets the daily cost of a rental vehicle for a specific time period and up to the specific daily limit you purchased. You can generally purchase limits of $20/day and 600/30days or $30/900 or $40/1200. The first number indicates the daily maximum coverage and the second is the maximum coverage for 30 days. For example, if you purchase 30/900, the policy would pay up to $30 per day for up to a maximum of 30 days or $900, whichever comes first.

Most insurance carriers have pre-arranged agreements with several car rental agencies that may include direct bill and pre-negotiated rates. Remember, if you exceed your policy limits, you are responsible for the difference. You should select a rental rate based on the type of car you need. If you have a family SUV, you should select a daily rental rate for a comparable vehicle.

How Do I Know When I Am Covered?

If you’re involved in an accident or your car breaks down, call your independent agent. If you purchased the coverage, you are insured while the vehicle is in the shop being repaired, up to your coverage limits. If your vehicle is not drivable, you may be able to get a rental vehicle before your vehicle is being repaired, but always check with your agent first. If your vehicle is stolen, call the insurance company or your agent immediately after calling the police to report the car stolen since most have a clause in the policy that does not cover a rental vehicle for the first 48 hours after the reported loss. If your vehicle is totaled you will have a limited time frame in which to replace it and that may be less than the maximum that could be paid out under this coverage.

What Rental Reimbursement Costs

The cost of rental car reimbursement coverage is generally quite reasonable: under $20 per vehicle per year. It can bring peace of mind knowing you won’t be forced to go without a vehicle should something happen to your car.

We Can Help

As your independent insurance agent, we can help you select the appropriate daily rental car reimbursement limit for you. Contact us when you are purchasing your auto insurance and we can help you find the right insurance company for you.