
Sign up & start saving!
Get our weekly newsletter for the latest in money news, credit card offers + more ways to save
Finder is committed to editorial independence. While we receive compensation when you click links to partners, they do not influence our content.
Updated . What changed?
If you find yourself without a car because yours is getting repaired, rental car reimbursement coverage could come to the rescue. But most policies have limits on how much they’ll pay out, meaning a lengthy repair process might max out your coverage.
If your car is getting repaired at the garage after a car accident, rental car reimbursement coverage can cover the cost of a rental until you get your own car back. A few companies also pay for alternative transportation, reimbursing you for public transit or ridesharing instead of a rental car.
This coverage applies when your car gets damaged for reasons covered under your collision or comprehensive coverage. However, all of these coverage types are optional. You’ll have to add at least comprehensive or collision, then rental reimbursement to your policy at an additional premium.
For your insurer to pay for or reimburse you for a rental car, you’ll need to meet three criteria:
In some cases, you’ll choose a rental car, pay out of pocket for the cost and make a claim for reimbursement from your insurer. However, some companies partner with rental companies to pay for the rental directly. For example, as of July 2019, if you have Geico insurance and you choose a car from Enterprise Rent-A-Car, Geico will get billed directly.
The amount of time that the rental is covered is determined by the insurance company up to a specific dollar amount or number of days, like $30 per day for 30 days.
Check your current insurance to see if your policy covers driving a rental car. You may want extra insurance through the rental car company if you don’t have comprehensive or collision coverage through your own policy.
If your car is totaled or stolen, you may have different limits for rental car reimbursement than you have for when your car is in the shop. Contact your insurer to find out if you’re covered for a rental car — and for how long.
Yes, you could recoup the cost of rental reimbursement coverage easily if you get in an accident. Some policies add this option for as low as $4 per month, or $48 per year.
The average time for repairs after an accident is two weeks, according to the Insurance Information Institute. If you paid a weekly rate of $210, the accident would set you back $420 total. At the above rate, it would take you over eight years of paying for the coverage to exceed its reimbursement amount after an accident.
You might consider the rental car reimbursement add-on in several situations, such as:
Skip this coverage if you don’t have a full coverage policy. The cost of rental reimbursement increases significantly if you don’t have comprehensive or collision coverage on your policy. Collision coverage can cost nearly $300 per year, and comprehensive coverage averages around $130. You’ll spend less paying for a rental car out of pocket if you ever need one instead of upgrading to a full coverage policy.
The amount of coverage depends on the rental car costs in your area and the type of car you’ll need. Most policies let you choose what daily amount you prefer, such as $30 or $50 per day. However, it also comes with a maximum limit that insurance will pay out overall for the claim, such as $500 or $750.
If rentals cost more in your area or you’d need a large car like a minivan, you might choose high coverage limits. However, your premiums will increase the more coverage you buy.
Paying for this add-on for car insurance doesn’t mean you’ll get reimbursed every time you rent a car. It’s only for when you can’t use your car due to a covered event, like a car accident. And it won’t cover extras like gas.
Rental car reimbursement won’t pay for:
If your car gets damaged in an accident and you didn’t buy this add-on, you can choose plenty of options for getting around. Those options include:
Rental car reimbursement coverage can help keep you on the road while your car is out of commission. Even more, the add-on often costs much less than the average car rental total after an accident, helping you recoup your investment in this coverage. Find the best deal by comparing car insurance companies that offer this coverage.
Reflect on the costliest disasters of 2020 — and make sure you have the insurance that covers them.
Save money by targeting your coverage to your largest debts.
Even if you haven’t found another job yet.
Plus, 2 you can’t.
Preliminary data on fatal accidents and driving behavior could explain why drivers haven’t seen higher insurance refunds.
Have your sights set on travel this year? We compared nearly 100 cards to find the best deals and perks.
A permanent life insurance policy’s cash value can be used as a retirement income supplement, though using it reduces your policy’s death benefit.
How much do pets actually cost? We’ve crunched the numbers.
Learn how insurance companies use identifying info from your VIN to set rates.
Getting a policy can be complicated, but it offers protection for you and your employees.