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Do I Need Auto Insurance to Rent a Car?

By November 29, 2021April 11th, 2024No Comments

Suppose that you have a breakdown or a car accident. You are probably in for a few headaches and a lack of transportation while you have to have the vehicle repaired. Luckily, in the right circumstances, your auto insurance can be more of an asset to you even beyond paying for your repairs. Properly designed auto insurance plans will continue to provide liability insurance even when you are not driving your personal car. Plus, plans can also supplement the costs of a rental car, and therefore further ease your cost burden from the ramifications of an accident.

Let’s take a closer look at how your auto policy can assist you at times when you are using a rental car. In the end, your policy can be an exceptional aide during a time when you already have enough concern on your plate.

Auto Insurance Coverage for Rental Cars 
Car keys with Insurance Key Chain
If you are going to be driving a rental car, then you will likely continue to receive coverage from certain portions of your existing auto insurance plan.

Policies from most major insurers remain in force at all times, regardless of what vehicle a policyholder is actually driving (or whether they are driving at all, in fact). Therefore, you might only have to look as far as your current coverage to receive benefits. This is due to the fact that certain components of coverage apply specifically to a driver, as opposed to covering a vehicle.

Commonly, you will continue to receive coverage like:

  • Liability Insurance: This coverage will help the policyholder when they are at fault for an accident and must repay others harmed by their mistakes. For example, if you rear-end another vehicle at a stoplight, then the accident is legally your fault. Therefore, you will likely be required to repay the other driver for their vehicle damage and injuries, and your auto liability insurance will enable you to do so. It will apply regardless of whether you are driving your own car or someone else’s, including a rental. 

  • Medical Payments/Personal Injury Protection: Most auto insurance plans will include benefits, which can pay for your own medical bills lost income and other recovery costs that arise following an accident. These injuries can occur regardless of whether you are driving your own car or a rental, and these benefits can therefore continue to cover you at this time. 

Generally, any coverage that is mandatory to you under your state’s driving laws will continue to apply even when you are driving a rental car. Therefore, you will never face the legal situation of having to purchase additional coverage that you are already supposed to have anyway.

Keep in mind, however, that if you feel that you need additional liability insurance or further coverage for physical damage to a vehicle, then you might need to invest in coverage offered by the rental company. A rental company’s insurance offerings can transfer responsibility for vehicle damage from you to the rental company, for example, and thus free you from having to pay for vehicle damage. Higher liability coverage options might also be available.

Coverage to Assist with the Costs of a Rental Car 

In addition to continuing to provide your liability and medical insurance benefits when you drive a rental car, your auto insurance plan can also help you cover the costs of these vehicles yourself. After all, following a car accident, the expense of paying for a rental car (often for several days or weeks) can quickly become excessive.

If you have rental car reimbursement benefits on your plan, then your insurance policy will agree to cover the costs of this vehicle up to a certain limit. For example, most will agree to pay you a certain amount per day for the rental expenses. At times, this might cover the full cost of the rental vehicle, while in other cases you will have to pay a residual cost once you exceed the maximum amount the policy will pay. Still, rental car reimbursement coverage can prove instrumental in helping you lower your overall cost burden for an accident.

Keep in mind, rental car reimbursement will only apply if your personal car is damaged in a covered accident, like a wreck. However, your existing liability coverage or medical benefits will continue to offer coverage even when you rent a car of your own volition, such as to drive on vacation. For more information on the particulars of your coverage, speak to your auto insurance agent.