What Happens When You Get Into an Accident in a Rental Car
Whether you need a vehicle while on vacation or your primary car is in a garage awaiting repairs, a rental car provides a reliable way to get around. Thanks to the tremendous competition in the rental car industry, solid deals can be acquired even on luxury car models. No matter how great the car you choose to rent is, nothing protects it from chaos scenarios on the road. Simply put, you just might find yourself involved in an accident. This leads to obvious questions about how to handle an accident when you drive a rental car. Consider it wise to ask these questions and find the answers long in advance of signing a rental contract. Otherwise, you might not find yourself in the best position when an accident happens.
Owned vs. Rental Cars: Is There A Difference
What is the main difference between getting into an accident with your own car and one owned by a rental company? Really, there isn’t much of a difference. Either you or the other party does or doesn’t maintain the necessary insurance appropriate to cover the damages. The type of claim filed depends on the circumstances of the accident as well. Did you cause the accident or did the other party?
Before addressing issues related to specific accident scenarios, let it be known a car rental company isn’t going to allow you to drive off the lot without some sort of insurance in place. Specifically, the renter must carry liability insurance.
Liability Insurance Covers At-Fault Scenarios
When you rent a car from a rental company, the enterprise wants to make sure you have liability coverage in place. Liability coverage pays for property damage and personal injury caused by your own negligence. The payment amount would be up to the maximum of the policy. So, if you carry $300,000 in liability insurance, the policy covers up to $300,000 in damages. Beyond that, you are on your own unless an additional umbrella policy is in place.
The liability on your primary vehicle may extend to a rental car. Call the insurance provider and find out for sure. Some may extend liability coverage for a limited period such as 30 days. Others may present different terms and requirements to transfer coverage to a rental. Always check with the provider to be sure.
Those who do not own a car and carry no insurance would need to purchase a non-owner policy to cover liability. The cost of the premiums may vary depending on the insurance company and your own personal driving and credit history.
Be aware that liability coverage comes into play when you are at fault. If the other driver causes the accident, a claim would be filed against his/her policy. If the person doesn’t carry insurance, then you would need uninsured/underinsured driver’s coverage in place to pay for the damages. Depending on the terms of the rental company’s agreement, without the uninsured/underinsured coverage, you might be responsible for the costs. This leads us to the next matter: damage waivers.
Damage Waivers and Extra Costs
Damage or losses caused to the rental vehicle wouldn’t be covered by liability insurance. Such insurance covers damages to other people’s property including but not limited to their vehicles. On a standard insurance policy, you have the option to pay for collision and comprehensive insurance. Collision insurance pays for damage you inflict upon your own vehicle due to negligence. Driving into a signpost would be such an example. Comprehensive covers non-driving losses. Flooding that ruins a vehicles transmission or the theft of the vehicle fall under comprehensive coverage.
You might maintain comprehensive and collision coverage on your primary policy. These two coverage options may or may not transfer to a rental vehicle. Never make assumptions. Check with the insurance company to be sure. If the coverage isn’t in place, the rental company commonly provides the option of paying for a waiver.
A waiver refers to a contractual agreement with the renter to waive its rights to hold you accountable for damage/losses to the vehicle. Paying a set fee per day usually covers the waiver fee. The waiver may be costly, but owing $30,000 to the rental company because someone stole the car would be even more costly.