Liability and Insurance in a Rental Car
November 18th, 2019|
What Makes Rental Car Accidents Different?In any collision, the at-fault party has liability. However, the rental agreement you sign when you rent a car means you are responsible for any damage to the rental car, even if you were not at fault. This is why it’s so important to carefully inspect your rental vehicle for scratches and dents before leaving the lot. After an accident caused by someone else, you will be required to pay your insurance deductible directly to the rental company, and then your insurance company will go after the at-fault party for the remainder. Additionally, you may be responsible for paying “loss of use” fees for every day the rental vehicle is being repaired to compensate the rental company for the profit they’ve lost. Finally, the rental company may not wait until the insurance matter is settled and charge you for the damages right away. If this happens, you will need to deal with the at-fault party’s insurance directly to get reimbursed.
What Steps to Take After an Accident in a Rental CarMany of the initial steps you will need to take after an accident in a rental car are the same as those you would take immediately after a car accident in your own car. Follow these steps after a car accident:
- Exchange contact information with the other driver.
- Take pictures of the scene of the accident.
- Make a police report.
- Notify your insurance provider.
- Seek medical attention.
- Notify your rental company.
- Contact a lawyer.
Determine What Type of Coverage You HaveThere are three main sources of insurance coverage available for rental car accident claims.
- Your Personal Insurance: Nearly every state in the U.S. requires drivers to carry auto insurance in order to legally operate a vehicle, even if minimum coverage amounts vary. Most personal insurance policies will also cover accidents that take place in a rental car, but make sure to read the fine print. Some rentals may be excluded, such as exotics or trucks.
- Insurance Provided by Your Credit Card: Most major credit cards offer rental car insurance as a perk when you make the entire payment for the rental on the card. However, this is often collision insurance only, and won’t cover any medical expenses. Additionally, it may be secondary insurance, which means it only kicks in for what your personal insurance doesn’t pay, such as your deductible.
- Supplementary Insurance Provided by the Rental Company: When you rent a car, you will be offered additional insurance for purchase at the counter.
What Type of Coverage is Available from the Rental Company?The most common type of supplementary insurance provided by the rental company is collision insurance, but there are four major types of insurance you can purchase at the time you make a rental.
- Collision Damage Waiver: This absolves the renter of responsibility for damage to or theft of the rental, except as the result of reckless driving or if the damage occurred while someone other than renter was driving.
- Liability Coverage: This covers property damage and medical expenses incurred by individuals other than the renter after a car accident in which the renter was at fault.
- Personal Accident Insurance: This covers medical expenses of the renter and any of the renter’s passengers.
- Personal Effects Coverage: This covers lost or damaged personal property kept in the rental vehicle.