It’s common to wait until you need a rental car to ask yourself, “Does my car insurance cover rental cars?” Most auto insurance companies list this coverage as “rental car reimbursement” or similar. You are not required to use your rental car reimbursement coverage, but it is a nice perk if and when needed.
If you have the appropriate coverage selected and you have an open claim, your insurance can help cover the cost of your rental car typically. Car insurance companies award rental car coverage regardless of who’s determined to be at fault in the accident if that’s the cause for the filed claim.
Auto insurance policies that include rental car reimbursement coverage are often subject to limitations. You cannot use this type of rental coverage in all situations. In addition, your coverage may only absorb some of the costs associated with obtaining a rental car through your car insurance policy. With FINN, for example, subscribers are permitted to submit a request for reimbursement of up to $40 a day for up to 20 days ($800 cap).
When does car insurance not cover rental costs?
You must have rental reimbursement coverage as part of your insurance policy for the insurance company to cover the cost of your rental. If you do not have this specific coverage selected, you are responsible for any costs incurred by renting a car while your car is in the shop. These statements apply when an active insurance claim is in process, regardless of who was determined to be at fault in the case of an accident.
Rental car reimbursement does not cover the following:
- A car rented for a business trip
- Vacation car rentals
- Obtaining a rental due to breakdowns or mechanical failures of your primary vehicle
- Routine maintenance or basic repairs
You are still responsible for paying for gas and your insurance premium while renting a car covered by rental car reimbursement policies.
Rental car reimbursement does not apply when your car is in the shop and covered under warranty or mechanical breakdown insurance. If the dealership determines that your factory or extended warranty covers repairs, they may provide rental car coverage separate from your auto insurance. Again, it depends on what conditions your policy stipulates under covered circumstances.
