Auto Insurance: Why Pay for Rental Reimbursement
Car Insurance to Cover Cost of Rental in Case of Auto Repair
Mar 27, 2009
Particularly for drivers in the far-flung suburbs, having reliable transportation isn’t an option, it’s a necessity.
When the driver is caught in an auto accident that causes damage to his or her car and the auto must be parked at the auto repair shop for a week or more, running errands and getting to and from work becomes far more difficult. That’s where rental reimbursement auto insurance coverage comes in handy.
Auto Insurance: What Is Rental Reimbursement Coverage?
Rental reimbursement auto insurance pays for costs related to the rental of a car if the driver’s car is temporarily out of service due to collision or other damage.
The driver sets rental reimbursement as a limit per day/maximum figure on his or her auto insurance policy. For example, 20/600 rental reimbursement coverage provides a maximum of $20 per day and $600 maximum for the total duration of the car repair.
Situations in which the driver may find himself or herself without a car due to car damage are rare. But when it does happen, it’s good to know that the driver won’t be left stranded without transportation to and from work.
Auto Insurance: Should the Driver Purchase Auto Insurance at the Car Rental Office?
One of the most common decisions drivers face when renting a car is whether to accept the rental car company’s offer for liability auto insurance coverage. Meaning, if the driver is found at fault in an auto accident with the rental car, who pays for damages.
Most auto insurance policies extend liability auto insurance to rental cars for those who are already covered under their own auto insurance. Thus, accepting liability auto insurance coverage while in the rental car office is simply adding an unnecessary expense.
However, drivers considering car rental should always check with their auto insurance company first before renting the car to make sure liability extends to rental cars under their auto insurance policy.
Auto Insurance: Who Benefits from Rental Reimbursement Coverage?
It’s an unfortunate reality, but an auto accident or act of God can happen at any time, taking the car out of commission for a week or longer. Thus everyone can benefit from rental reimbursement auto insurance.
However, if a driver has purchased a new car with an extended warranty plan that already covers rental reimbursement, this optional auto insurance coverage can be declined to prevent redundancy and to save money on monthly auto insurance payments.
Auto Insurance: The Bottom Line on Rental Reimbursement Coverage
Rental reimbursement auto insurance provides an added benefit in the case that the driver’s car is put out of commission for a few days or longer.
While some new car owners who elected additional extended warranty coverage may find this a redundant auto coverage, virtually everyone else benefits from the peace of mind in knowing that they will have reliable transportation in the event of a lengthy car repair.
See related articles, "Auto Insurance: Towing and Labor Coverage," "How to File a Claim With Auto Insurance," and "Auto Insurance: Who Needs Comprehensive Coverage."
 |
