UPDATED: Aug 11, 2020
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If something truly unfortunate happens to your vehicle, and it needs to be in the body shop for a while getting repaired, you’re probably going to need an alternate form of transportation.
But public transit ranges from fairly poor to dangerous in most areas. Constantly paying for cab fare or rideshare (like Uber) can get expensive very quickly.
And you can only ask friends and family for rides so many times before it becomes too inconvenient for them. For many drivers, the easiest option is just to spend some money on a rental car until they get their vehicle back.
If you’re worried about this happening to you, you’re not alone. Many drivers who want to avoid this financial expense decide to purchase an extra auto insurance coverage option: car insurance rental reimbursement coverage.
But is it a good idea for everybody? Or are there drivers out there who would be better off keeping their premiums low by not purchasing this coverage?
We will go over the specifics of rental reimbursement coverage in this article. Once you know the facts, you can make an informed decision about whether or not rental reimbursement auto insurance coverage is a good idea for you.
Understanding the Limits of Rental Reimbursement Coverage
While rental reimbursement coverage is very helpful for avoiding major expenses while your vehicle is getting fixed, it isn’t completely comprehensive (unfortunately).
There are certain things that rental reimbursement will not pay for, and you should know what they are. You should also know what it does pay for so that you can budget around meeting your transportation needs until you get your vehicle back.
Rental reimbursement coverage will not pay for:
- The gas you purchase to keep your rental vehicle going
- Rental costs associated with regular vehicle maintenance
- Rental costs associated with going on vacation
- Incidental expenses associated with the rental, such as security deposits, rental insurance, and other costs
As far as what your rental reimbursement coverage will pay for, that’s fairly simple. As we’re sure you can guess by now, this coverage will pay for the cost of your daily rental.
This can cost anywhere from $25 a day to $100 per day, depending on where you live, the vehicle you need to rent, and the type of coverage you purchase.
If you’re thinking about purchasing rental reimbursement coverage, it’s a good idea to already have comprehensive/collision coverage on your policy first.
Most of the time, your insurance company will not reimburse you for rental expenses outside of a claim filed against your Collision coverage.
And if you don’t have any Collision coverage to file a claim against, you may not benefit at all from purchasing rental reimbursement coverage.