Are you wondering if State Farm car insurance covers rental cars? Look no further! In this article, we’ll dive into the details of State Farm’s rental car insurance coverage, what it includes, and when you might need it. Let’s get started!
Does State Farm Car Insurance Cover Rental Cars?
The answer is yes, State Farm car insurance covers rental cars. If you have State Farm auto insurance with full coverage, it extends to cover you when renting a car for personal use. However, if your rental car is more expensive than the car you insure, additional protection might be necessary.
If you rent a car for business purposes and don’t have a commercial policy with State Farm, you’ll need rental car insurance. State Farm also offers a separate policy specifically for renting cars. This coverage can come in handy if you don’t have a car and don’t plan to use a credit card when renting a vehicle.
Rental Car Coverage vs. Rental Car Reimbursement
It’s important to note that State Farm’s rental car insurance and rental car reimbursement are two different types of coverage. Rental car insurance covers you when you’re renting a car for travel or personal use. On the other hand, State Farm’s rental car reimbursement coverage reimburses you for the cost of renting a car when your vehicle is in the shop for covered repairs.
State Farm also provides up to $500 for travel expenses when you or a covered driver is more than 50 miles from home and your vehicle is damaged. This coverage includes lodging, meals, and transportation to your home or intended destination.
What Is Rental Car Insurance?
Rental car insurance is an auto insurance policy designed to protect those who rent cars but don’t have a full-coverage policy or aren’t using a credit card to rent the car. It’s a separate insurance policy sold by your insurance carrier or rental car company.
What Does Rental Car Insurance Cover?
Rental car insurance typically includes liability insurance to cover the repair and replacement costs of a vehicle involved in an accident with you, as well as any medical expenses the other driver incurs. Additionally, rental car insurance offers several add-on features:
- Loss/Collision Liability Waiver: This waiver releases you from any financial liability if your rental car gets damaged or stolen. It also eliminates the need for a deductible on repairs.
- Collision Damage Waiver: Some companies offer a collision damage waiver (CDW), which covers repairs or replacement of a rental vehicle in case of damage or theft.
- Personal Accident Insurance: This coverage pays for medical bills for you and your passengers, regardless of who caused the accident. It works similarly to MedPay and PIP. If you have health insurance, it may cover your medical expenses after meeting any copay or deductible requirements.
- Personal Effects Coverage: This coverage provides reimbursement if personal belongings are stolen from your rental car. If you already have a homeowners or renters insurance policy with State Farm, it may provide coverage for theft as well.
What Doesn’t Rental Car Insurance Cover?
Rental car insurance may not cover certain expenses, such as gas, tolls, and security deposits imposed by the rental car company. However, these costs may be covered by rental car reimbursement coverage, which reimburses you for expenses related to getting a rental car while your vehicle is in the shop.
It’s also essential to check with your insurance provider to determine your coverage amounts before traveling. If you’re renting a vehicle with a value that exceeds your coverage amounts, additional coverage may be necessary to protect you in the event of a crash.
Do You Need Rental Car Coverage?
There are specific instances where having rental car coverage makes sense:
- Limited insurance: If your car insurance coverage includes higher deductibles and doesn’t cover rental cars, you should consider rental car insurance. This applies if you have liability-only coverage but want collision and comprehensive coverage for your rental.
- No insurance: If you don’t own a vehicle and don’t want a non-owners car insurance policy, obtaining rental car insurance from State Farm is an affordable way to stay protected while traveling.
- International travel: Some countries have laws that require you to pay for any damage incurred on a rental vehicle before leaving the country. Rental car insurance covers these costs, providing peace of mind.
- Business travel: If you’re renting a vehicle for work purposes but don’t have a commercial auto insurance policy, rental car insurance is necessary unless your company or personal credit card provides coverage.
- High-value rental: If you’re renting a vehicle with a value that exceeds your coverage limits, additional protection is recommended.
On the other hand, there are instances where rental car coverage may not be necessary:
- Full-coverage insurance: If you have full coverage on your personal car, your comprehensive and collision coverages (as well as any medical coverage) typically extend to rental cars.
- Credit card coverage: Many credit card companies offer rental car insurance as part of their services. Before renting a car, check if your credit card issuer provides this coverage and review the limits.
- Travel insurance: Travel insurance often covers the costs of repairing or replacing rental vehicles. It may be cheaper than what rental car companies charge for their insurance.
- Other insurance policies: Homeowners and renters insurance can cover personal belongings stolen from a rental car. Health insurance can cover medical bills after copays or deductibles are met. Combined with a full-coverage auto policy, these policies eliminate the need for additional rental car insurance.
State Farm Rental Car Insurance: The Bottom Line
State Farm’s rental car insurance policy is ideal for travelers who don’t have auto insurance, need additional coverage, or want features like MedPay. It offers the same type of protection you would find with full coverage on a personal car, including collision, liability, and comprehensive coverage.
However, there are circumstances where rental car insurance may not be necessary. If you have full coverage on your personal car or plan to use your credit card for the rental, you likely already have the necessary financial protection. It’s best to check with your car insurance or credit card provider before hitting the road to ensure you’re covered.
Other Companies That Offer Rental Car Insurance
While State Farm is an excellent choice for rental car insurance, you may also consider other companies. Two recommended options are USAA and Erie Insurance:
- USAA: Best for Military – USAA provides full coverage for rental vehicles in the United States, with protection against physical damage, theft, loss-of-use, and coverage for up to 31 days internationally. It’s important to note that USAA is only available to military members, veterans, and their families.
- Erie Insurance: Affordable for Basic Coverage – Erie Insurance includes basic car renter insurance if you have a policy with collision and comprehensive coverage. You can easily add the policy by contacting an agent before your trip. Erie Insurance also offers unique coverages such as pet coverage, auto glass repair, personal item coverage, and locksmith service. Bundling multiple policies with Erie can earn you a discount of up to 20%.
FAQs
Q: Does State Farm car insurance cover rental cars?
A: Yes, State Farm car insurance covers rental cars. If you have State Farm auto insurance with full coverage, it extends to cover you when renting a car for personal use.
Q: What is rental car insurance?
A: Rental car insurance is an auto insurance policy designed to protect those who rent cars but don’t have a full-coverage policy or aren’t using a credit card to rent the car.
Q: When do you need rental car coverage?
A: You might need rental car coverage if you have limited insurance, don’t have insurance, are going overseas, traveling for work, or renting a high-value vehicle. It’s best to assess your specific situation to determine if rental car coverage is necessary.
Q: Are there instances where rental car coverage isn’t needed?
A: Yes, if you have full-coverage insurance, use a credit card with rental car insurance, have travel insurance, or have other insurance policies (such as homeowners or renters insurance), you may not need additional rental car coverage.
Conclusion
State Farm rental car insurance provides valuable protection for those who rent cars. Whether you’re traveling for personal or business purposes, State Farm offers coverage options that can give you peace of mind. However, it’s essential to assess your existing coverage and consider alternatives before committing to rental car insurance. By understanding your needs and options, you can make an informed decision that suits your specific situation.
