Understanding Rental Car Coverage: Be An Informed Consumer

A well-known feature of car insurance is rental car reimbursement. However, although many policyholders are aware of this option, they may not be overly knowledgeable of how this coverage component works. To ensure you are an informed consumer, learn more about this coverage option.

Documented Claims

One of the more important parts of this coverage to keep in mind is that it can only be applied to a documented claim. For instance, a policyholder could not simply activate this coverage to help cover the cost of a rental car for leisure purposes. Typically, you will first have had to file a claim for vehicle damage. Next, the vehicle either needs to be in a repair shop or it must be totaled. 

Coverage Periods

It is also important to be mindful of the fact that this policy component will typically be limited by a coverage period. In short, the coverage period outlines the duration for which a policyholder can access this benefit. For example, your policy might state that coverage is limited to 30 days. Fortunately, this limit is per claim, not per the life of the policy, so you will be able to maximize this benefit again in the future if necessary.

Costs Maximums

Another measure to be mindful of is cost maximums. In addition to a period coverage limit, there are also maximums that policyholders will be limited to. For instance, the policy might state that you can only be reimbursed up to $30 a day. Fortunately, policyholders have the power to lower or increase their daily coverage limit to ensure they can rent a vehicle that they believe is suitable for their needs. 

Important Considerations

Rental car coverage is an add-on to a standard policy, so it is common for some people to forgo coverage. A common justification for declining coverage is the belief that the policyholder can simply rely on their spouse's vehicle in the event of an incident. Unfortunately, this task can sound easier than it is to actually pull off. You and your spouse may not have the same work schedules, or you may have other obligations. In the event of extensive vehicle damage, coordinating transportation for weeks could be complicated, so make sure you weigh your options. 

Keep in mind; rental car coverage can vary widely from company to company. Be sure you research your options to determine what is best for your needs. 

Contact a company like Your Local Insurance Services to learn more.

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