It’s not uncommon for someone to overlook the fact that most automobile policies provide either limited rental car benefits or no coverage at all. When the policy does include this coverage, often known in the insurance industry as rental reimbursement or transportation expenses coverage, the allowance is usually only $15-$20 per day. As you can imagine, that amount is usually not enough to cover the full daily cost of a rental car.

Being stuck without a rental vehicle when your regular mode of transportation is out of commission can be very frustrating to say the least. As an adjuster in day-to-day claim handling, I’ve encountered many instances where a rental vehicle saved the day for a policyholder for two reasons. Firstly, they had a vehicle to get them around while their vehicle was being repaired. Secondly, by selecting sufficient rental car coverage under their auto policy, they were covered for the full daily rate, plus all applicable taxes, for a rental that was comparable in size and class to the damaged vehicle.

While on the subject of rental cars, the aforementioned coverage should not be confused with coverage for liability or damage to a rental vehicle. Liability protection for any property damage or bodily injury to others while driving a rental, as well as coverage for damage to the rental vehicle itself, is typically provided by the liability and physical damage portions of your automobile policy, subject to any applicable deductibles.

Typically, rental car companies offer optional insurance that you can purchase when renting a car. Should you purchase this optional coverage? That’s entirely a personal choice but keep in mind that if you carry collision coverage under your auto policy, you may already have some coverage for the rented vehicle should you be involved in an accident. Be sure to check your policy or speak with your agent to determine what coverage your policy might provide.

Not all circumstances are the same, but transportation expenses coverage is a very convenient and often inexpensive option. It’s strongly advised you read your policy and discuss with your insurance agent the specific details and exclusions regarding both transportation expenses coverage, as well as coverage for liability and damage to a vehicle that you rent.

The coverages described here are in the most general terms, and are subject to the actual policy conditions and exclusions. For actual coverage wording, conditions, and exclusions, refer to the policy or contact your agent.