Does My Auto Insurance Cover a Rental Car Accident?

by Doug Zanes | Last Updated: July 30, 2020

Unfortunately, car accidents can happen anywhere, at any time. Sometimes they occur when you are driving a rental car. But what happens if you find yourself in this situation? Do you have to pay for the damages out of pocket or will your auto insurance cover a rental car accident?

When you rent a vehicle, you agree to return it in the same condition that it was in when you received it. It doesn’t matter if the accident was someone else’s fault. You are still responsible.

Personal Car Insurance vs. Rental Car Company Liability Coverage

If you rent a car for personal use, your own auto insurance policy will likely provide some basic protection that the rental car company will also try to sell you. If you carry liability, collision, and comprehensive insurance for your own car, you will be covered for at least the limit of the policy. It’s important to note that car rental companies usually offer this same protection.

You should make sure that your own insurance covers at least the Actual Cash Value (ACV) of the car you are renting. Therefore if your own personal vehicle is significantly less valuable than the car you’re renting, your own insurance won’t be adequate. In such a case, a liability insurance supplement may be your best bet.

The rental company will offer you a liability insurance supplement. Both this supplement and your own insurance will cover the cost of damage that you are responsible for causing to the vehicle.

Collision Damage Waiver

The rental company offers a collision damage waiver, also referred to as a collision waiver or loss damage waiver. This waiver will commonly cost between $9 and $19 per day. Still, a rental car company may charge you for the time that it can’t use its car because it’s being repaired. While these expenses are sometimes covered under your own policy. Before you sign the collision or loss damage waiver, check your policy to see if it includes coverage for loss-of-use of a rental vehicle.

Rental car companies will also offer personal accident insurance, which covers any medical fees that occur as a result of a car accident. This includes injuries to the rental car driver and passengers and may cover the cost of an ambulance or sometimes even death benefits. However, if you already have medical payments, no-fault or personal injury coverage through your own personal auto insurance policy, as well as health insurance, personal accident insurance isn’t necessary.

What Can You Do?

Rental car crashes can often be complex to handle – especially when your own car insurance is involved and responsible for coverage. That’s why it’s so important that you consult with a knowledgeable and experienced attorney who can help to guide you through your car accident case.

Doug Zanes
Doug Zanes: Founding Attorney Raised in Douglas, Arizona, and went to college at Arizona State University and graduated from law school at St. Mary’s University School of Law in Texas. Doug began practicing law in Phoenix Arizona in 1997.
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