If my car breaks down, will insurance cover a rental?

Cars can be unpredictable machines. If your car breaks down and is in the shop, you still need to get around. The easiest fix for this is rental cars, which are widely available, but can be expensive.

If you have an auto insurance policy, you might wonder if it covers the cost of a rental car in sticky situations. This blog will break down the situations car insurance can potentially cover a rental.

Let’s get started!

Will Insurance Cover a Rental If My Car Breaks Down?

The short answer to this question is: sometimes. The longer answer is: yes, but only if you have rental car reimbursement as an option on your insurance policy. Even then, it really depends on the situation that caused your car to break down.

There’s some information that is important to know here. Getting a rental car covered by insurance depends on your car insurance policy. It depends not only on the options you have added, but also on the type of policy. Whether your car broke down because of an accident or because it needed routine or nonroutine maintenance can also be a factor.

This is a basic guide that looks at a few specific situations. If you need a more comprehensive primer on car insurance, check out our Car Insurance 101 Guide.

If I’m in an Accident, Can I Get a Rental Car?

An accident and a breakdown are not the same. However, both can cause your vehicle to stop working temporarily.

We’ll start talking about insurance and rental cars by discussing what happens in case of an accident:

Liability-Only Policies 

You may not be covered by your insurance policy if you have a liability-only policy. This means that you and your car may not be protected in the event of an accident. Usually, this only includes damage that occurs to another vehicle or driver in an accident. In the case of a liability-only policy, a rental car might not be covered.

However, if you’re not at fault for an accident and you have a liability-only policy, the other driver’s insurance may cover your rental car. It’s worth checking into if you find yourself in this situation.

Comprehensive and or Collision Car Insurance Policies 

A rental car could be covered in many circumstances with comprehensive or collision policies. These car insurance policies cover many potential problems, including accidents, theft, and even hitting an animal.

Under some comprehensive collision policies, the cost of a rental car while your car is repaired is automatically included. However, don’t take that option as a given. Sometimes you may need to add rental car reimbursement to your policy in the form of a rider. A rider is an optional type of insurance coverage you can add to your policy for a little extra cost.

If you’re not sure which type of insurance policy you have, check with your insurance provider. If you’re looking for a car insurance policy, contact us so we can search for the best rates for you. We’ll help you compare insurance quotes from nearly 20 top-rated carriers so that you don’t have to.

What Is Rental Car Reimbursement?

Rental car reimbursement is a coverage option you can add to your regular comprehensive collision car insurance plan. If you choose to pay for rental car reimbursement, your insurer could cover rental costs if your car breaks down or needs repairs after an accident.

Rental car reimbursement only covers the cost of a rental car if something happens to your personal vehicle. It should be obvious, but rental car reimbursement won’t cover rental vehicles for a vacation or other purposes.

It’s important not to confuse rental car reimbursement with rental car coverage. Reimbursement provides a rental car for you while your personal car is being repaired or replaced due to a claim. Rental car coverage is insurance that protects you when you are driving a rental car that is provided to you. It’s often part of your rental car contract.

Note that regular auto policies typically do not cover rental car insurance for personal rental vehicles. Additionally, they do not cover vehicles over a certain weight, such as moving vans, trucks, or pull-behind trailers.

Rental Car Reimbursement and Other Forms of Transportation

Rental car reimbursement coverage could pay for public transportation. This includes taking a bus or train to work or school instead of renting a car. More extensive policies might also cover the cost of rideshare services like Uber or Lyft and sometimes taxis as well.

Rental car reimbursement coverage doesn’t pay for a rental if your car is just at the shop getting maintenance done. You will need to cover that personally. Or, if you’re lucky, your mechanic might provide a loaner vehicle as part of their service.

The Limits of Rental Car Reimbursement

One more thing to note here: rental car reimbursement coverage is often limited. That means that there are usually a few caveats on allotted time or the allowed cost of your rental car reimbursement.

Everything is different, so make sure to check your policy carefully. You can likely expect your rental car reimbursement to stop after a specific period of time or dollar amount. After this, you’ll need to pay out of pocket.

You also may have options on where you can rent a car through your insurance policy. Many insurance providers might have a list of approved rental car providers that the policies they provide will pay for. It’s a good idea to make sure the rental cost is covered. Check with your agent to see if you’re using an approved provider.

How Much Does Rental Reimbursement Cost?

If you opt for rental reimbursement coverage, policies can vary a little by insurance provider.

To many, this is a low cost compared to the potential out-of-pocket cost of a rental car. For example renting a car for a weekend can cost hundreds of dollars. However, a year of rental reimbursement insurance coverage only costs about 100 dollars, on average. This is just one way that the right insurance plan could potentially result in savings*.

To learn more about rental reimbursement costs or adding this coverage to your policy, contact our team.

Who Pays for a Rental Car After a Breakdown or Accident?

What if I Have an Accident With Liability-Only Insurance?

Imagine this scenario: you’re in an auto accident, and now your vehicle needs extensive repairs. You have liability-only insurance, and you’re not at fault in the accident. Who pays for a rental car?

The answer here is to check with the other party’s insurance provider. Even though you are not to blame, your liability-only insurance probably won’t cover the cost of your repairs or rental. The person who hit your car may have comprehensive or liability-only insurance. If they do, their insurance could be responsible for both your rental and repair bills.

What if I Have an Accident With Comprehensive Collision Insurance?

Now imagine another scenario: you’re in an auto accident due to poor weather conditions on the road. Your vehicle needs repairs, but it’s hard to say exactly who is at fault yet until there’s an investigation. If that’s the case, who pays for the rental car?

If you have a rental reimbursement rider, the answer here is your auto insurance company. Your investment in insurance will pay off by keeping you on the road even while your car is out of commission. Check on what the limits are on time and cost, and make sure to choose a preferred rental shop.

What if I Have an Accident With No Insurance?  

This is not desirable. However, it is important to mention how risky driving without insurance is.

Driving without insurance is illegal. Penalties and seriousness of not having insurance vary by state. Driving without insurance is not only irresponsible, but also illegal. Furthermore, it can be expensive.

If you get in an accident with no insurance, you’d be liable for all of the expenses out of pocket. This includes repair bills, rentals, and medical bills. In addition, you could be sued by the other party, even if you’re not at fault. You could potentially be fined, lose your license, have your wages garnished, or be jailed for driving without insurance.

How can I get a quote for an insurance policy with car rental coverage included?

If your car breaks down, the type of insurance policy you have determines whether or not you have rental coverage. The riders and endorsements you’ve chosen to expand your coverage with will also impact coverage.

If you’re ready to shop for auto insurance with car rental coverage included, our team can help. Check out the options available to make sure you get the right coverage for your needs. Our searching gets you savings.*

*Savings, if any, vary based on the consumer’s profile and other factors. Contact your insurance agent for more information. Restrictions apply.

All information provided in this publication is for informational and educational purposes only, and in no way is any of the content contained herein to be construed as financial, investment, or legal advice or instruction. Rate Insurance does not guarantee the quality, accuracy, completeness or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error free. Some information in the publication may have been provided by third parties and has not necessarily been verified by Rate Insurance. Rate Insurance, its affiliates and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action.

Sources

What is covered by a basic auto insurance policy? | III

Rental Car Reimbursement vs. Rental Car Coverage | The Balance

Why You Should Never Drive Without Car Insurance | Time