Does my car insurance cover rental reimbursement if my car is being repaired?

Car insurance coverage gives you peace of mind that if you are in a car accident, your vehicle will be repaired so you can get back on the road.

However, vehicle repairs can take days or weeks if the damage is extensive or parts must be ordered from manufacturers or suppliers. Also, if you only have one vehicle, you might not have any other way to get around.

Many people rent a car while it is being repaired, but that can get expensive without insurance. If you’re wondering whether your car insurance will cover rental reimbursement while your car is being repaired, this is what you need to know.

Car Insurance That Covers a Rental Car While Yours Is Being Repaired

If you have full coverage car insurance, you may be covered for any kind of cost or expense related to insured accidents and incidents. For example, basic liability insurance doesn’t cover damages to your vehicle, but adding collision and comprehensive coverage will.

However, this won’t automatically cover your expenses for renting a car while yours is repaired. You’ll typically need to add rental reimbursement to your policy. This optional add-on is designed to help you keep your life moving while your car is out of commission. On average, it costs less than $10 per month. (For more information, read our “Can I get a rental car while my vehicle is being repaired?“).

How Rental Reimbursement Works

Rental car reimbursement is a type of car insurance coverage that provides a daily allowance for renting a car while yours is in the shop. For instance, you might be able to rent a car worth up to $40 per day until your repairs are complete or up to a predetermined, set number of days.

This coverage usually doesn’t carry a deductible, but you must have comprehensive and collision coverage and file a claim for repairs under one of those policies.

How to Get Reimbursed for Your Rental Car

You need to take several steps to ensure that you will be reimbursed for vehicle rental when filing an insurance claim. These include:

• Before you have an accident, if your insurance policy does not include rental reimbursement, you can request to add an endorsement for your policy.
• Be sure you know how to file a car insurance claim for rental reimbursement, and do so while you file the claim for your vehicle repairs.
• Understand what your rental reimbursement coverage will pay for, both per day and in total, before renting a vehicle. Your coverage will determine what kind of vehicle you can afford to rent.
• Check whether your insurance company works with a rental car company. Some companies have special arrangements with rental companies that might get you better rates.

Once you have everything set up, collect the rental car and confirm all payment details. Remember that you will only be covered when your vehicle is in the repair shop.

Rental Reimbursement When You Are Not at Fault

Rental reimbursement coverage generally applies when you’re at fault in an accident and file a collision or comprehensive claim. If another driver is at fault, their liability insurance should cover the cost of your rental vehicle while your car is being repaired.

It can take time for this kind of coverage to come through because the insurance companies first need to establish who is at fault.

In that case, you could use your rental reimbursement insurance and have your insurance company recover it later. Alternatively, you could pay out of pocket for a reasonable and comparable rental vehicle and then claim the reimbursement from the other insurance company.

Case Studies: Car Insurance Coverage for Rental Reimbursement

Case Study 1: Comprehensive Coverage With Rental Reimbursement

Sarah had comprehensive car insurance coverage that included rental reimbursement. When her car was involved in an accident and needed repairs, she was able to rent a car while hers was in the shop. Her insurance company covered the rental expenses, providing her with a temporary means of transportation during the repair period.

Case Study 2: Basic Liability Coverage Without Rental Reimbursement

Mark had basic liability car insurance that did not include rental reimbursement coverage. When his car was damaged in an accident, he had to rely on public transportation and borrowing cars from friends while his vehicle was being repaired. He realized the importance of having rental reimbursement coverage to avoid the hassle and inconvenience of finding alternative transportation.

Case Study 3: At-Fault Accident and Rental Reimbursement

Lisa was at fault in an accident that caused significant damage to her car. Fortunately, she had rental reimbursement coverage as part of her car insurance policy. Her insurance company covered the cost of a rental car while her vehicle was being repaired. This coverage allowed her to continue with her daily activities without disruptions and helped her manage the financial burden of renting a car.

Rental Car Reimbursement While Your Car Is Being Repaired

If you want to be sure you’ll have a car to drive after an accident, rental car coverage is a smart investment. This inexpensive coverage will ensure you can afford to rent a vehicle while yours is in the shop.

To explore your options, compare car insurance and find rates and coverage that meet your needs.