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Insurance Insights

Is Rental Car Reimbursement Coverage Worth It?

By Justin Staebler | Johnson Financial Group

3 minute read time

One of the last things you want to worry about after a car accident is how you’re going to get around without your car or pay for other transportation. Renting a car for an extended period of time can get expensive quickly. Since your automobile policy may not automatically cover the cost of a replacement car after an accident, rental reimbursement and towing coverage is an inexpensive insurance option to help when you need it most.

Rental car rates are increasing and car repairs are taking much longer than they have in the past due to the availability of auto parts and labor shortages. Your rental car out-of-pocket expenses can add up quickly.

What Is Rental Reimbursement Coverage?

Typically, rental car reimbursement coverage is optional to cover the cost of a rental car if your vehicle is damaged in a covered accident and can't be driven. The coverage can be added to your auto policy for only a few extra dollars a month. To add rental reimbursement coverage to your policy, you may need to carry comprehensive and collision coverage.

Rental reimbursement coverage will typically cover the cost of a rental car up to a certain dollar amount per day for a set number of days or less. For example, a $30 per day/$900 per accident rental reimbursement limit means you’ll be covered up to $30 a day and no more than $900 per each covered accident. There’s a variety of limits and per occurrence options to choose from. Without rental car reimbursement coverage, you may be responsible for the cost of a rental car if your car cannot be driven after an accident.

Also, towing and road service is an additional coverage option that’s there for you when life throw an unexpected mishap your way. For a nominal annual fee, a dispatch service will send the nearest qualified emergency roadside assistance from a network of towing, road service and locksmith professionals. That way, help is never more than a phone call away.

What Is The Difference Between Rental Car Insurance and Rental Car Reimbursement Coverage?

Rental car insurance is separate coverage offered by a rental car company and is used to pay for damage and liability you may incur when renting a car. You may also have this coverage under your personal car insurance policy’s collision and comprehensive or as an endorsement. You may also have rental car coverage through a credit card. In comparison, rental car reimbursement coverage is an optional coverage you can add to your personal auto insurance policy to help pay for rental car costs while your vehicle is being repaired after an accident.

Don’t wait to review your auto insurance coverage until after you have an accident or need roadside assistance. Advisors at Johnson Financial Group are here to help you understand your coverage and the best way to protect you and your family. Contact an advisor today if you have any questions about how we can help you go about your normal routine, regardless of the unexpected bumps in the road.

Insurance products and services offered by Johnson Insurance Services, LLC, a Johnson Financial Group Company. Not FDIC insured, not a deposit, not insured by any federal government agency, not bank guaranteed, may lose value. For your protection, coverage cannot be bound or changed via voicemail and is not effective until confirmed directly with a licensed agent.