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When your car breaks down, worrying about rental car costs is probably the last thing on your mind. If the breakdown is due to normal wear and tear, your insurance won’t cover a rental. However, if your car is ineligible for use while undergoing covered repairs, your insurer may cover a rental car for a limited time, provided you have rental reimbursement coverage.
How Does Rental Reimbursement Work?
Rental reimbursement functions like other claims with your insurance provider. After submitting a claim, your insurer will cover up to your policy’s limits, which could be a total amount, like $900, or a daily limit, such as $30, up to $900. Coverage limits vary, so it’s advisable to review your options with an insurance agent.
To utilize rental reimbursement, you typically need to add an endorsement to your policy. This coverage applies to claims under your comprehensive or collision insurance. Some insurers may require both types of coverage to qualify for rental reimbursement. If only comprehensive coverage is included, you won’t be covered for collision-related claims.
When Does Car Insurance Cover Rental Costs?
Your car insurance will cover rental costs when a qualifying claim is filed and accepted. However, you must already have rental reimbursement coverage on your policy. If you are not at fault for the accident, the other driver’s property damage liability may cover your rental costs while your vehicle is being fixed.
When Does Car Insurance Not Cover Rental Costs?
There are scenarios where rental reimbursement won’t apply. For example, if you own two vehicles, such as a car and a truck, and only the car has rental reimbursement, you won’t be covered if the truck is in an at-fault accident. Other cases where expenses aren’t covered include:
- Renting while on vacation: Any rental costs incurred during a trip will be out-of-pocket.
- Mechanical breakdown: The coverage doesn’t extend to situations where your car is simply undergoing repairs due to mechanical issues.
- Routine maintenance: Just like with mechanical breakdowns, standard servicing does not qualify for rental reimbursement.
How to Check if Your Insurance Covers Rental Cars
While rental reimbursement coverage is not always standard in car insurance policies, many providers offer it as an add-on. Insurance experts suggest adding this coverage as it usually doesn’t significantly increase your premium, but can help save money if your vehicle is damaged in a covered incident.
Rental Reimbursement vs. Other Optional Coverage Types
Understanding the nuances between rental reimbursement and other similar coverages is essential. Rental reimbursement covers you for rental expenses due to accidents or damages covered by your insurer, while standalone rental car insurance applies to rentals with their own terms. Mechanical breakdown coverage protects against internal mechanical issues but does not provide rental reimbursement.
Frequently Asked Questions
How Much Does Rental Car Reimbursement Coverage Cost?
The cost varies by provider but typically adds around $2 to $15 per month to your premium, making it generally cheaper than renting out of pocket following a covered loss.
If My Car Breaks Down, Will Insurance Pay to Tow It?
Whether your policy covers towing depends on if you have roadside assistance included. Most insurers allow this as optional coverage, which typically handles towing and various other aid services.
