September 12, 2011

When Rental Reimbursement Coverage Is Worth The Money

In many parts of the United States, suddenly losing use of a vehicle can be a major problem. Many drivers commute, and in order to get to work, they'll need to rent a car if their primary vehicle is inoperable for any reason. Unfortunately, rental car costs can exceed a few hundred dollars per week, so car rental is an expensive luxury. Many auto insurance companies offer a special car insurance add on called rental car reimbursement for this reason. This coverage pays for some of the costs of car rental, and in some cases, it can be well worth the money. However, drivers should carefully consider the advantages and disadvantages of this car insurance add on coverage before adding it to their policies.

The first thing to consider is that rental car reimbursement doesn't cover all aspects of a car rental and may be somewhat restrictive, depending on the insurance provider that offers the coverage. Most rental reimbursement programs won't pay for the extra insurance that car rental agencies offer with their vehicles. A driver will have to pay for these costs out of pocket, and rental car insurance can be expensive–in many cases, it's as expensive as the actual cost of vehicle rental. However, it's important to note that a driver's car insurance coverage will apply to any rental vehicles in most states, and some drivers feel that special rental car insurance is unnecessary.

Rental car reimbursement may also be restricted to situations in which a rental car is necessary due to another type of claim. In other words, a policyholder can't rent a vehicle simply because his or her primary vehicle is in the shop. Rental car reimbursement may also be limited to the costs of a few weeks' rental. This can limit the feasibility of rental car reimbursement for some drivers. Also, some drivers simply don't need the coverage, as they have other ways to get to work and to handle errands without a vehicle. Drivers who live in large cities may find rental car reimbursement to be a waste of money, regardless of how inexpensive the add on seems.

Drivers should carefully evaluate their capabilities to decide whether a major accident or car theft would necessitate a car rental. They should also understand how their insurance providers' rental car reimbursement coverage works. It's true that this add on can be a very helpful coverage, and in some cases, it can save drivers hundreds of dollars after a major accident. However, researching the value of an add-on is an important step for getting the most out of car insurance coverage.