How Rental Reimbursement Works (and Why It Matters After an Accident)
If your car is in the shop after an accident, the last thing you want to worry about is how you’re going to get to work, school, or appointments. That’s where rental reimbursement coverage can help.
Many drivers don’t realize rental reimbursement is an optional part of auto insurance—and they only learn about it when they need it most.
Here’s a clear breakdown of what rental reimbursement is, how it works, and when it applies.
What Is Rental Reimbursement Coverage?
Rental reimbursement coverage helps pay for the cost of a rental car if your vehicle is not drivable due to a covered claim.
This coverage is designed to help you stay mobile while your vehicle is being repaired after:
an accident
a covered comprehensive claim (like theft, vandalism, or storm damage)
It is important to note: rental reimbursement is not the same as roadside assistance or towing coverage.
When Does Rental Reimbursement Apply?
Rental reimbursement usually applies when:
your vehicle is being repaired due to a covered claim
you have the rental reimbursement coverage on your policy
the claim is approved by the insurance carrier
Examples of situations where rental reimbursement may apply:
you’re in an accident and your car needs repairs
your car is damaged by hail and goes into the shop
your vehicle is stolen and you need transportation
When Rental Reimbursement May NOT Apply
Rental reimbursement may not apply if:
you do not carry the coverage on your policy
the damage is not covered by your policy
your car is in the shop for routine maintenance
your claim is denied
the vehicle is drivable and does not require repair (varies by carrier)
Some policies require that your vehicle be considered not safe to drive or inoperable.
How the Coverage Is Paid (Daily Limit + Maximum Limit)
Rental reimbursement is typically written with two limits:
a daily limit
a maximum total limit
For example:
$30 per day / $900 maximum
$40 per day / $1,200 maximum
$50 per day / $1,500 maximum
If your rental car costs more than your daily limit, you may pay the difference out of pocket.
How Long Can You Keep the Rental?
The rental is usually covered for the time your vehicle is:
being repaired
waiting for parts (depending on claim rules)
declared a total loss (coverage may end shortly after settlement)
The exact timeline depends on the carrier and claim type.
Do You Choose the Rental Company?
In many cases, your insurance carrier will:
recommend preferred rental companies
arrange direct billing
provide a claim number for the rental
You may be able to choose your own rental company, but it can sometimes create delays or reimbursement paperwork.
What If the Accident Was Not Your Fault?
If another driver is at fault, their insurance may provide rental coverage. However, it can take time to confirm fault and accept liability.
Many people choose to use their own rental reimbursement coverage to avoid delays, then the carriers may sort out reimbursement later.
Why Rental Reimbursement Coverage Is Worth Considering
Rental reimbursement is typically affordable, but it can be extremely valuable after a claim—especially if:
you rely on your vehicle daily
repairs may take weeks
parts are delayed
your car is declared a total loss
A rental car can become expensive quickly, and rental reimbursement helps reduce that financial stress.
Final Thoughts
Rental reimbursement coverage helps pay for a rental car when your vehicle is in the shop due to a covered claim. Understanding your daily limit and maximum benefit can help you avoid unexpected costs.
If you’re not sure whether you have rental reimbursement on your policy—or want to review your options—we’re here to help.
