Does Car Insurance Cover Rental Cars?
I’m commonly asked if car insurance covers rental cars. It’s important that we clarify the question because it could be interpreted two ways.
- Will my personal auto insurance cover me while driving a rental car?
- If I have an accident, will my car insurance cover the cost of renting a car?
These are two very different questions with potential two very different answers…
Will my personal auto insurance cover me while driving a rental car?
If you’re insured in New York State, your personal auto insurance policy will most likely cover you while renting a private passenger vehicle for 30 days or less in the United States, US Territories and Canada. You should check with us or check your policy to be sure your auto insurance will cover rental cars in the location you’re traveling to. One caveat to this is that you must have permission to drive the rental car. This means that you must be listed as a driver on the rental contract or be the spouse of the primary vehicle renter. Also, if your only auto insurance coverage is a commercial auto insurance policy, you should check with us first because there could be additional coverage options needed.
If I have an accident, will my car insurance cover the cost of renting a car?
For your policy to cover the cost of renting a car, you’ll likely need to purchase Transportation Expense coverage. Different insurance companies have different names for this coverage – some call it Rental Reimbursement coverage or something similar. This is an optional coverage so it’s a good idea to have a conversation with your insurance agent if you’re unsure if you’ve purchased it or not.
If you’d like to have a conversation about your insurance, please contact us here.
John Lofrumento, CFP®, FSCP®, RICP®
President, The Lofrumento Agency
Clifton Park, NY / Ballston Lake, NY