What Is Rental Reimbursement Coverage?

A covered accident can leave your car in the shop for days or weeks. Rental reimbursement coverage is generally designed to help address that gap, but it is not automatic, and understanding how it works can prevent an unwelcome surprise.

What is rental reimbursement coverage?

Rental reimbursement coverage, sometimes called transportation expense coverage, can generally help pay for a rental vehicle, or in some cases other transportation costs, while your vehicle is being repaired following a covered comprehensive or collision claim, subject to the specific policy's terms, limits, and waiting periods.

Is rental reimbursement automatically included in an auto policy?

Generally not. Rental reimbursement is typically an optional coverage that must be specifically added to your policy, subject to the specific insurer. Do not assume you have this coverage simply because you carry comprehensive and collision.

Does rental reimbursement apply to every type of claim?

Generally, rental reimbursement applies in connection with a covered comprehensive or collision claim, meaning the underlying claim itself must be covered under those coverages for rental reimbursement to apply, subject to the specific policy's terms.

What are typical limits on rental reimbursement coverage?

Rental reimbursement coverage often includes both a daily limit and a total maximum limit, such as a specified dollar amount per day up to a specified total amount, subject to the specific policy. These limits vary by insurer and by the specific coverage level you select.

If your specific daily limit is lower than the actual cost of a comparable rental vehicle in your area, you may need to pay the difference out of pocket.

Is there a waiting period before rental reimbursement coverage begins?

Some policies include a waiting period, or apply the coverage from the date the vehicle is dropped off for repairs, subject to the specific policy's terms. Review your policy for the specific timing rules that apply.

Does rental reimbursement cover a rental car after an accident that wasn't your fault?

This can depend on the specific circumstances and applicable policies. In some situations, if another driver is at fault, that driver's liability insurance could potentially address a rental car as part of the claim, subject to that insurer's process and the specific circumstances. Your own rental reimbursement coverage may also apply depending on how the claim is being handled. Ask your insurer how this would work in a specific accident scenario if you are unsure.

How much does rental reimbursement coverage typically cost?

Costs vary by insurer, the specific coverage limits selected, and other factors related to your policy. Because it is generally a relatively modest addition compared to other coverages, some drivers view it as a worthwhile addition, while others decide the cost is not justified based on their specific circumstances, such as having access to another vehicle if needed.

Should you have rental reimbursement if you have another vehicle available?

This depends on your specific situation. If you have reliable access to another vehicle during a repair period, rental reimbursement coverage may be less critical for you than for someone who has only one vehicle and would otherwise be without reliable transportation.

Does rental reimbursement cover other transportation costs, like rideshare services?

Some policies may allow rental reimbursement coverage to be used more broadly for certain alternative transportation costs, subject to the specific policy's terms and any applicable limits. Confirm with your insurer whether your specific policy allows this kind of flexibility.

What should you ask your insurer about rental reimbursement?

Ask what the specific daily and total limits are, whether there is a waiting period before coverage begins, whether the coverage would apply if another driver was at fault for the accident, and what the actual added premium cost would be for adding this coverage to your policy.

The takeaway

Rental reimbursement coverage is generally an optional addition to your auto policy that can help address the cost of a rental vehicle while your car is being repaired after a covered comprehensive or collision claim. It is not automatic, and its specific limits and conditions vary significantly by policy.

Reviewing whether you have this coverage, and understanding its specific limits, before you need it is far more useful than discovering the details for the first time after an accident.