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What is rental reimbursement coverage on your auto insurance policy?
Rental reimbursement helps cover the cost of a rental car, should your normal vehicle be in the shop getting fixed, due to a covered accident.
What does rental reimbursement cover on your auto insurance policy?
Rental reimbursement will generally have a limit, a dollar limit as to how much they will help pay for your rental car, should you need to use it.
This coverage kicks in once your vehicle has been in a covered accident and has gone to the shop to be fixed. Most insurance companies allow you to have the rental car for up to 30 days or until your vehicle is fixed and back in your possession.
What does rental reimbursement coverage not cover?
Rental reimbursement coverage is only there for you if your vehicle is in a covered accident.
This means you can’t use this coverage simply because your vehicle breaks down for some mechanical reason or because you’re driving up north for the weekend and you want a nicer vehicle. It’s only going to be useful if your car is in a covered accident, meaning the insurance company is helping you repair your vehicle and your vehicle has to go in the shop for a set number of days. At that point, the coverage is useful to you.
But for all other reasons this coverage is not going to come into play. The easy way to think about it is if there’s no claim for the accident, there’s not going to be rental car reimbursement coverage.
Do you need rental reimbursement coverage?
If you have a lot of extra vehicles at your house, like a third vehicle, or if you don’t drive often, if you work from home and you don’t commute every day, you may not need it.
However, if you rely heavily on your vehicle every day and you don’t have the backup, you definitely want to purchase rental car reimbursement coverage on your auto insurance policy.
How much rental reimbursement coverage do you need?
Most policies start at $30 a day, going all the way up to $50 or $60 a day. Again, this depends on your specific vehicle and what you would need to replace it with while your vehicle is in the shop getting fixed. If you can get by with a very, very basic rental car, you can select the lower amount of $30. If you have a bigger vehicle and that’s what you would need to replace temporarily while your car’s in the shop, then you want to purchase the higher limits of $50 or $60 a day.
Keep in mind that most policies are going to cap that daily limit after 30 days or until your vehicle is fixed and back in your possession.
How much does rental reimbursement coverage cost on your auto insurance policy?
Like most things with insurance, this depends heavily on the type of vehicle you drive, the amount of accidents you have, the people listed on your policy and their ages. There are a number of different factors that can go into play.
However, for the most part, rental car reimbursement coverage is going to cost you $5 to $15 a month. Like all things, it’s best to consult with an independent insurance agent. They can look at your specific situation and craft a policy that is going to give you the best coverage at the best price.