Spring Break time!! With a lot of us trying to escape the last bits of Winter, let’s talk a little bit about rental cars and how the coverage relates back to our personal auto insurance.
Let’s focus our attention first on renting a vehicle on vacation. When renting a car, the coverage that you have on your personal auto insurance policy will coverage that rental car as a temporary substitute vehicle (if you are bored you can find that language in your auto policy). That means that any coverage which you have on the personal auto policy would extend to the rental car. The most common elements are liability, comprehensive, and collision coverage. As long as you have full coverage on a vehicle on your personal auto policy, coverage would apply and you could take the opportunity to sign waivers on the liability and physical damage portion of the rental contract.
Keep reading for a few potential issues.
Since the rental car is covered like a vehicle on the policy, a few things can come up where the coverage might not apply. The most frequent example is loss of use. Some rental car companies will charge for the loss of use of a vehicle while it is being repaired from an accident. Since your policy responds like the car is yours, this might not be addressed. The attempt to recover varies by rental cars agency and the coverage for the insured varies by insurance carrier so if you have concerns the best thing to do is ask the rental car agency and your agent what your carrier’s position is on the coverage.
Another issue we see from time to time surrounds renting things that are not private passenger autos as defined in the insurance policy. These would typically include a moving truck or a motorhome. Again, the details are very important and the coverage provided is different from carrier to carrier. The best thing to do if you are renting one of these items is to start by contacting your agent to determine what the carrier will provide for coverage. Once you have that answer, you can usually fill in the gaps with what is needed through the rental agency for the vehicle.
Also note that the coverage from your personal auto policy only transfers to vehicles in the US and Canada. I did not say rented in the US and Canada but IN the US and Canada. If you are headed somewhere and rent a car in the US and drive to Mexico, the coverage would not apply. If traveling outside of that territory, the best plan is to purchase the coverage offered by the rental agency.
Bottom line to the rental car coverage concerns is that it is probably a great time to review what your carrier covers with your agent before you rent the vehicle to make sure that you have all of the facts and can make an informed decision.
To all who are traveling, enjoy.
Thank you for allowing us to protect your families.