What Is Rental Reimbursement Coverage and When Do You Need It?
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Have you recently checked your car insurance policy to see if there are optional add-ons? Rental reimbursement coverage, for instance, can pay for rental car costs and other transportation costs while your car is being repaired following a covered insurance claim.
This comprehensive guide to rental reimbursement car insurance explains the insurance claims process, policy limits and exclusions, the potential costs of rental reimbursement coverage, and when it makes sense to add rental car insurance to your policy.
What Rental Reimbursement Coverage Actually Covers
Rental reimbursement is an optional feature of your auto insurance policy. It pays for your rental car costs or alternative transportation, such as bus fare or ride shares, when your car is being repaired after a covered incident or accident. Rental reimbursement is not the same as temporary car insurance, which simply provides coverage for short-term car rentals.
Add-on rental reimbursement insurance covers at least a portion of your daily rental charges, but it won’t pay for routine maintenance, fuel costs, or security deposits that are required to get a rental.
How Daily Limits and Duration Caps Work
Auto insurance that includes rental car reimbursement will vary from policy to policy, but most policies offer up to $50 per day of rental expense coverage.
In addition, most insurance policies also include maximum coverage limits for car insurance with rental reimbursement. The cap can be a dollar amount or a number of days. Even if you need a longer rental period beyond the limit, your insurance company may not extend it. Contact your insurance company for more information on your rental period limit.
When Rental Reimbursement Does Not Apply
Your auto insurance policy may specify some exceptions for rental reimbursement, including but not limited to the following:
- Maintenance-related repairs: Your insurance company will not cover a rental car when you need regular vehicle maintenance or upkeep.
- Vacation rentals: If you are renting a car while on vacation, rental reimbursement coverage does not apply. However, your regular auto coverage may cover damage to the rental car.
- Faulty repairs: Rental reimbursement won’t cover you if your auto body shop makes faulty or partial repairs.
- Claims not covered under your policy: Depending on your specific comprehensive and collision coverage, you may also have claims and items that are excluded from rental reimbursement. That’s why it’s important to read and understand your current auto coverage.
When You Might Actually Need This Coverage
Rental reimbursement coverage can be quite valuable in certain situations when you absolutely have to rent a car after an accident. Take these as examples:
- You don’t have another vehicle to use while your primary car is being fixed.
- You don’t have access to public transportation.
- Your daily activities and lifestyle depend on having a reliable car.
- Your car can take several days to weeks for repair, and paying out of pocket for a rental can put a strain on your wallet.
The bottom line: Deciding whether rental reimbursement coverage is beneficial comes down to assessing your needs and responsibilities.
Cost of Adding Rental Reimbursement to Your Policy
The average cost of rental reimbursement coverage ranges from $2 to $15 per month. If you can bundle this add-on with other options or forms of insurance, it may be even more affordable.
How To File a Claim for Rental Reimbursement
Here are the steps for filing a rental reimbursement claim:
- Determine your coverage: Review your current auto insurance policy to confirm if you have rental reimbursement coverage. Make sure you also review the terms, such as the daily limit and any caps on rental coverage, so you understand what should be covered.
- Document the incident and need for rental coverage: Whether you were in a car accident or your car was damaged by severe weather or vandalism, document the accident and take photos. Get a copy of the policy report, if applicable.
- Reach out to your insurance company: Contact your car insurance company as soon as possible to report the incident and begin the claim process. Your insurance company will ask for details and documentation, which is why that step is so critical. Ask about the rental reimbursement process.
- Find a rental car: Your auto insurance provider might direct you to a specific rental car company. Otherwise, you will need to find a rental car. Maintain a copy of receipts and all other documentation.
- Track your claim: Keep tabs on your claim after it is initiated, and stay in touch with your insurance company about the status of your claim.
Once the claim is processed, expect a settlement offer from your insurance company. Review it carefully and check that it covers the appropriate expenses.
Compare Insurance Providers Offering Rental Coverage Options
The next time you are seeking car insurance coverage, turn to EverQuote for a free custom insurance comparison. You can view offers and options side by side to find the best auto insurance fit for your current and future driving needs. It only takes a couple of minutes to get a quote, and this process can save you valuable time and money when it comes to auto insurance and rental reimbursement coverage.
We can also help you find the best non-owner car insurance, bundled insurance policies, home insurance, and more.
Check out EverQuote today to start saving.
FAQs
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Premiums are sourced from over 30,000 zip codes across 200 insurance companies. We estimate premiums based on public filings for policies seeking 50/100 in liability with $500 deductibles for collision and comprehensive coverage. Estimated rates are based on a 35-year-old single female with a good credit score and no history of accidents or violations driving a 2023 Toyota RAV4 LE. We partner with Quadrant Information Services to source our data and assume no unique benefits or discounts are applied for these rates (unless otherwise stated). Your own rates may be different.