You’ve probably heard before that your personal car insurance will protect you in a rental car but that’s not always the case. If you’re going to skip the rental company’s coverage it’s important to understand the potential risks. Here are 3 situations where your personal car insurance policy won’t protect you in a rental car:
You Don’t Have Collision and Comprehensive Insurance Coverage
Your comprehensive and collision coverage pays for damage to your vehicle regardless of who is at fault for the accident. In most personal auto insurance policies this coverage will transfer over to a rental car that you’re borrowing but if you have liability-only insurance coverage there is zero protection for damage that can happen to the rental car.
If your rental car has an accident or it is vandalized, damaged by weather or stolen and you have liability-only coverage you could be responsible for paying for the entire cost of that car.
Many rental car companies will require verification of collision and comprehensive coverage in order to waive their coverage but they don’t always and that could be a very expensive mistake.
The Rental Car Company Makes a Claim for Diminished Value
A diminished value claim is a claim against the individual responsible for a car accident for the reduced value of the vehicle after it’s involved in an accident. Even though a?body shop will fix the vehicle back to the condition it was in prior to the accident, it will still show up on a VIN search and could reduce the resale value of the vehicle.
If you caused the accident the rental car company could sue you for the diminished value of the vehicle.
Most personal auto insurance policies do not include coverage for a diminished value claim so if the rental car makes a claim you’ll likely be on your own for it. This can be significant for high-value vehicles.
The Circumstances of Your Accident Are Excluded By Your Regular Policy
Many personal car insurance policies have limitations or exclusions for accidents that happen under certain circumstances like when someone is driving while intoxicated or racing. If your regular insurance policy excludes a situation it probably won’t be covered if the same thing happens in a rental vehicle.
The best way to know exactly what is and is not covered on your policy is to work with a local professional insurance agent who is licensed here in our state and knows the coverage exclusions for the different insurance policies they sell.
There’s a lot to understand when it comes to insurance and how it applies in certain situations. That’s why it’s so important to have a professional team of agents to help you, like we have here at Velox. Give us a call at 1-855-Go-Velox or find a local agency near you. And if you want a quick online quote just click here.