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UPDATED: Mar 13, 2020
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For many people, being without a vehicle is a major problem. Drivers rely on their vehicles to get them to and from work and school, carry their families and travel for business and pleasure. Driving is such an integral part of most people’s lives that even a week or two without a car can be disastrous. Since vehicles can often be in the shop for several weeks for repairs following an auto accident, having a backup vehicle available is a wise idea.
Of course, many people have multiple vehicles, so obtaining alternate transportation is easy. For others, the best and easiest way to obtain a backup vehicle is through renting another vehicle.
Car insurance companies provide compensation for the cost of car rentals, but rental reimbursement coverage does not come standard with all policies; you will need to ask for it by name. Additionally, there are other limitations that you should be aware of.
Getting a Rental Through Your Insurance Company
In order to obtain a rental vehicle from your insurance company after an accident, you will need to carry rental reimbursement coverage. This coverage can be purchased and added to your policy at any time, so if you purchased the initial policy without it you can always add it later. Unfortunately, the rental is only available if the accident happened after the coverage is added; you cannot add rental coverage after an accident and obtain a rental car that way.
Rental coverage is sold with limits. For example, a common rental reimbursement policy offers 30/30 coverage, meaning it pays up to $30 a day for 30 days or until the vehicle has been repaired or replaced, whatever happens first. If the rental costs more than $30, you will need to pay the difference out of pocket, even if you don’t use the rental for the full 30 days. Likewise, if the rental goes past 30 days, you will need to pay for the additional days out of pocket, even if the rental did not cost $30.
Rental coverage limits are customizable. You can get as low as $10 and as high as $100 or more. The higher the limit, the more the coverage will cost to add to the policy. Also bear in mind that some states handle this differently from others. In a few states, rental coverage is assessed in sum totals. For example, in Virginia, you get a total limit such as $900 to spend however you wish. An added bonus of rental coverage is that you can use it as a replacement auto whether or not you are at fault for the accident.
Getting a Rental From Another Person’s Company
Your insurance company is not the only source of a rental vehicle after an auto accident. If you are not at fault for the damage, you can obtain a rental car from the other person’s insurance company. In this case, the rental is paid as part of the other driver’s liability coverage, and the daily limits are determined by state law, not the insurance company itself.
Most states offer reimbursement for a substitute vehicle, generally the cheapest compact-size car available at the rental agency. Other states are required to provide a vehicle of a similar size to the one involved in the accident, while others provide a rental of like kind and quality to the one being repaired. It’s important to check with the insurance company that will be providing the rental to see what’s offered by state law.
Even if a state only requires reimbursement for a compact-sized vehicle, you can request a larger vehicle if you need one. For example, if you have a large family and require a vehicle that can accommodate multiple passengers, you can request a larger vehicle. Additionally, if you live in a rural area and require a four-wheel drive vehicle, you can request one. Bear in mind, however, that the insurance company is not obligated to pay for the upgraded rental, so you may be required to pay for the difference out of pocket.
Because there are few guarantees about rental reimbursement, it may be a good idea to purchase the coverage for your own policy. This will ensure that you will have a rental with the appropriate limits available to you whenever an accident occurs. Rental reimbursement coverage is usually very affordable to add to your policy, so if you do not already have it, you should contact your insurance company to see how much it would cost to add. That way, if you’re involved in an accident down the line, you can opt to use whichever option suits your needs better.