December 22, 2019

Renting a Car After Accident

Read more about Car Insurance

If your car is damaged in an accident, you may need a rental vehicle until it is repaired. Whose insurance covers the rental? And how long can you keep it? Find these answers and more in our guide.

Who Pays for a Rental Car After an Accident?

If you're in an auto accident, a rental gives you the freedom to get around while your car is in the shop. Who pays for the rental car depends on two main factors:

  • Who is at fault
  • What their insurance covers

We cover both scenarios below.

How is fault determined?
Fault is typically determined by a number of factors, including the testimony given by drivers and witnesses, documented evidence, and the police report filed on scene. After an accident, you should contact the police, photograph all damage, record any witness contact, and collect the other driver's insurance and contact information.

If You Are at Fault
In this case, your insurance company should be responsible for providing the rental vehicle IF your policy includes rental coverage (more on this below). Otherwise, you'll need to pay out of pocket.

If the Other Driver Is at Fault
If another driver caused the accident, their insurance company would be responsible for your rental vehicle. When speaking with the claims adjuster of the other driver's insurer, ask about getting a rental car.

What if you live in a no-fault state?
In no-fault states, it doesn't matter who caused the accident. Drivers submit their claims to their own insurance company for payment.

Do Insurance Companies Have to Pay for a Rental Car?

Once fault has been assessed, someone's insurance is likely to pay for the cost of the rental car following an accident. There are, however, some exceptions. Read on to learn more.

Your Own Insurance
Your auto insurer covers the rental if:

  • The accident was your fault AND you have rental reimbursement insurance.

  • The accident wasn't your fault, the other driver isn't insured, but you have rental reimbursement insurance.

  • You live in a no-fault state and have rental reimbursement coverage.

Check with your insurance company for the specifics of your policy, as not all accidents may qualify you to use this coverage. However, if you experience a collision with another car, a stationary object, or wildlife (such as a deer), you should be covered.

Rental reimbursement coverage is typically an add-on to your policy. The cost is often low ($1–$5 extra per month) and can be worth it to ensure coverage after an accident. Keep in mind that insurance companies will require you to have collision or comprehensive coverage to qualify.

The Other Driver's Insurance
If another driver is at fault, their insurance is responsible for covering reasonable rental expenses incurred while your vehicle is being repaired.

"Reasonable" means your rental vehicle should be of similar make, model, and value of the vehicle being repaired. It also refers to the timeframe—if you're purposely delaying the repair process, the insurance company may terminate coverage.

If the other driver's insurance company does not admit liability, you may have to seek reimbursement later. In this case, contact your own insurance company if your personal policy includes rental reimbursement.

Neither Insurance Covers
Neither driver's auto insurer covers the rental if:

  • The drivers don't have rental reimbursement coverage, regardless of who was at fault.

  • The drivers are uninsured or underinsured. The driver who's not at fault can sue the uninsured driver for repair, car rental, and medical costs.

Most rental coverages cover up to a daily and total policy limit.

How to Rent a Car After an Accident

Most car rental companies work with auto insurers to provide car rentals after an accident. Typically, this will occur after they determine who is at fault in the accident (except in no-fault states).

Here's how it works:

Reserving a Rental Car
Either you or the applicable auto insurer reserves the rental for the same day your car goes to the repair shop.

To avoid paying part of the rental, be sure to ask the insurance company about the daily allowance. Some rental reimbursement coverages allow for a daily amount for a set number of days. Others provide a flat dollar amount per day up to a certain amount.

The amount of coverage dictates the type of car you can rent. Options include:

  • Small to midsize sedan
  • Large to premium sedan
  • Medium to large SUV
  • Minivan
  • Pickup truck

You can rent a vehicle in a different class than what the insurance company will pay. However, you are responsible for the cost of the upgrade.

How long do you get a rental for a collision repair?
The average rental period after an accident is 2 weeks. But the rental company usually coordinates the time with the paying insurance company. The repair shop or the insurance company can update you as to when your car will be completed.

Returning the Rental
You will be notified when it's time to pick up your car from the repair shop. At that time, you can either:

  • Return the rental to the rental agency and arrange for them to give you a ride to the repair facility.

  • Return the rental and get your own ride to the repair shop.

When you drop off your rental, the rental car agency will finalize the billing. This may include:

  • Getting your full deposit back

  • Applying any deposit you paid to the remaining balance

  • Paying the amount not covered by the insurance company

  • Paying the full amount and getting reimbursed by the insurance company

Can I get rental reimbursement AFTER an accident?
You can add rental reimbursement after an accident. But the coverage will not apply to that recent accident since it began after the incident.

How Long Does It Take to Get a Rental Car?

The time involved in getting a rental depends on the insurance company that you're dealing with. If you're working with your own insurance company, a company agent can help you with renting a vehicle anywhere from immediately to within a day or two.

If you're working through the other driver's insurance company, they will need to research the crash, establish liability, and work through the claim. This can take up to a week to authorize a rental for you.

However, if you are in immediate need of a vehicle, you can talk to them about renting out-of-pocket and getting reimbursed at a later date. This can likely happen within 24 hours after the crash.

Some credit card companies offer rental car insurance. But the benefits are usually secondary, meaning your personal insurance policy will kick in before the credit card company coverage can be utilized.

When Does Rental Coverage Begin?

If your car is safe to drive, the rental coverage starts on the day you leave it at the body shop. It ends on the day your car is fully repaired or after 30 days (depending on your coverage). If your car is unsafe to drive, coverage will likely begin immediately.

Keep in mind that your rental reimbursement coverage will have a daily and maximum limit. For example, 25/750 means you'll be reimbursed up to $25 per day for a maximum of $750. Anything over your coverage limits comes out of your own pocket.

If your car is determined to be a total loss ("totaled"), reimbursement coverage will end when a settlement is reached. This allows you to search for a new car immediately.

What's Delaying My Insurance Claim?

Here are some factors that can slow own the rental process:

  • Poor Communication or Incorrect Information
    Be sure to verify all necessary information with the other driver at the time of the accident. And check to make sure your address and phone number are up to date on your own policy too.

  • Poor Body Shop Repair
    If the auto repair on your car is poorly done, point it out immediately to your insurance company. But keep in mind that this could delay resolving the claim.

  • Coverage Discrepancies
    If you or the other driver don't have sufficient coverage, resolving the issue can extend the claims process.

Bottom Line

If you are not at fault for an accident, a rental vehicle will likely be covered by the other driver's insurance company. If you are at fault, your company will only pay if you have the optional rental reimbursement coverage.

Talk with your insurance company about their policy before adding this coverage. It may be worth the slightly higher cost if you are involved in an accident.

More from CreditDonkey:

Collision Insurance

Types of Auto Insurance

How Much Car Insurance Do I Need

Car Insurance

What is Full Coverage Car Insurance

Do you really need to pay more for full coverage car insurance? Learn below if you need extra coverage, and see the cheapest prices.

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