What is Rental Auto Reimbursement Coverage?
Car insurance rental reimbursement pays for a rental when your own vehicle is in the body shop or has been declared a total loss after a covered event, such as a wreck. This is considered optional car insurance coverage. In most cases, this compensation is not available except as an add-on under your collision or comprehensive auto insurance policy.
Reimbursement only kicks in if your own insurer is paying for your repairs. If the other driver’s is paying for repairs, it might – and might not – pay for a substitute for you, depending on their coverage.
You can either choose to pay out of pocket and be reimbursed by the insurance company or let them arrange one for you and have them pay the bill directly. Most companies are required to provide you with some form of replacement transportation if their policy holder has rendered your vehicle inoperable, but you may get a vehicle that is far below the standards of what you are used to driving. You can usually arrange with the rental car company to upgrade at your own cost.
Keep in mind this is only available after a covered event, such as a car accident. It won’t pay for a substitute if your ride is in the repair shop for routine maintenance.
How Much Does Rental Car Reimbursement Coverage Cost?
Typically, less than $5 per month, although depending on your specific circumstances, rental car reimbursement coverage can cost as much as $15 per month.
What Does it Cover?
This covers the cost for the use of a substitute mode of transportation when your own ride is in shop due to a covered event, such as an auto accident. There is a daily limit on how much your alternate method of transportation can cost, as well as a limit on how many days you can have coverage. If you were at fault and you have this policy, you will be able to exercise it. However, if someone else was at fault, their carrier should provide you with an alternative means of getting around.
Since there are coverage limits, this won’t pay for an extended period of time. It’s usually good for 30 days. It won’t pay for any other costs associated with the claim, such as medical bills.
Is There a Deductible?
There is no deductible with this type of product. Keep in mind, though, that if you have been in an at fault wreck and are using this as part of your covered claim, then you have most likely engaged your collision coverage or comprehensive coverage, which both include a deductible.
How Long Can I Get It for After an Accident?
It depends on your insurer, so you’ll want to get that information prior to signing up. The typical scenario is 30 days and with a price cap of $40 to $60 per day. What that means is you can rent a vehicle for up to 30 days that costs somewhere in the neighborhood of those amounts daily.
How Much Are Rental Car Costs?
It fluctuates somewhat depending on demand, but it’s generally based on the type of automobile and the state where you reside. The average cost is between $40 and more than $100, depending on the company you choose. You may find some comparably priced companies and then decide based on the amenities, such as online reservations, self-serve kiosks and easy pickup and drop-off options.
Keep in mind that any charges over your daily auto rental compensation allotment will come out of your pocket, so be sure you understand all the costs and fees. For example, a GPS may be considered extra.
If your policy is covering the bill, you may be able to pay the company and get reimbursed or you may choose to use a company that has an agreement in place with your provider, meaning the bill will not pass through your hands. If another driver’s policy is footing the bill, keep in mind that it will also have a cap on what type of vehicle you end up driving. You can upgrade to something more comfortable, but you’ll be paying the difference.
Can I Use a Service Like Turo?
Like Airbnb or Vrbo, Turo is a site where privately-owned vehicles can be offered by their owners at a daily rate. Unless you are using a provider through your insurer, you are free to rent a ride from any company. Keep in mind that Turo has additional fees (for the service and things like young drivers) as well as a minimum number of days requirement (typically 3). So the cost of the vehicle you see listed per day is not the price you will pay.
What if I Use a Friend’s Personal Car?
There are several things to consider when “renting” a friend’s personal ride. First and foremost, make sure your provider is OK with you renting from someone that is not part of a recognized company. Next, make sure your friend’s provider is OK with them using their vehicle this way.
If both of those items are good, your friend can “submit” an invoice, you both sign and the insurer pays your friend – or you if you paid them. In this situation, you can submit your documentation that you paid (a cancelled check, Venmo reciept, etc).
Rules and regulations vary from state to state and individual providers, so always check before you do anything that may put you out of the legal arena of being able to file a claim.
Can I Get Reimbursed for Using Public Transportation?
Yes. If you decide to use the bus, train or any other public transportation in lieu of renting, your policy should cover it. The benefit of this product is to pay you back for your transportation expenses.
What is Rental Car Insurance?
You can purchase an optional coverage from the rental car company. Although people get the two types confused, rental coverage is not a part of your automobile policy and rental reimbursement is part of your policy.
The rental company offers a collision damage waiver, supplemental liability, personal accident and personal effects coverage.
It’s recommended to take a close look at these optional options. Most of what they offer is probably covered under your already-existing policy or may be covered under the credit card you used to pay.
What is the Difference Between Rental Car and Rental Car Reimbursement Insurance?
Car insurance rental reimbursement is not an optional part of your existing auto policy. It is additional protection offered by the car company when you rent from them.
Rental compensation is an optional part of your regular auto insurance policy that you can elect to include and that will help you pay for a substitute if your vehicle ends up in the repair shop after a covered event, such as a wreck.
Do I Need Car Insurance Rental Reimbursement?
If you think you are at risk for being at fault in an accident sooner rather than later, compensation is a wise choice. Rental car reimbursement can be helpful if the roads you drive on are usually crowded and congested with frequent accidents. However, the average driver who practices safe and defensive driving may spend more money buying the protection every month than they’ll ever recoup after an accident.
Insurance companies typically have a daily limit on either the number of days you can have a substitute on their dime and/or how much you can spend each day.
What to do After an Accident
If possible, move to a safe area. If you cannot move your vehicle and there is no safe place to hang out, stay in your vehicle. Check on anyone involved in the accident, if you are able. Call the police to report the accident. You may need a police report later for unresolved claims. You’ll need to gather as much information about anyone else involved as you can. Be sure and contact your provider to report the accident if you need to file a claim.
Find Out About Affordable Rental Car Reimbursement Today
Are you wondering if you need to add reimbursement to your auto policy? At Freeway, our agents can help you find the right amount of coverage for your circumstances at an affordable rate. Contact us today for a quick, fast online insurance quote or by calling us at 800-777-5620 or by visiting us at one of our local offices.