Do you need Rental Reimbursement on your auto insurance?

The short and sweet answer is yes but I am not the short and sweet type when it comes to insurance. So let’s dig a little deeper.

Many individuals dont think they need it and many times forgo it to save money. Honestly this coverage is only about $30 to $40 per vehicle annually, if not less. That’s not alot when you consider it’s an annual cost and what it means for you.

Recently I had a client find out the hard way how important Rental Reimbursement is. Another vehicle hit my client’s vehicle while parked and unoccupied. Initially the client attempted to have the claim handled by the responsible party’s  company. However the adjustor was indicating the vehicle was a total loss and that decision made the client uncomfortable. Add on the client had paid extra money for Replacement Cost coverage on the totaled vehicle on their own auto insurance policy. The client attempted to go back to their own insurance for Replacement Cost coverage but it was determined they had no Rental Reimbursement on their own auto policy. The claim process would start over with the client’s own insurance company and leave them out of pocket for another rental vehicle.

In the end the client settled with the responsible party’s insurance company to reduce the amount of stress and move on ultimately.

Had the client opted for Rental Reimbursement when the policy was purchased the client would have had a completely different result.

Yes, you can shave off a few dollars on your auto insurance by not including Rental Reimbursement but it can have a severe impact at the time of a claim.

So purchase Rental Reimbursement for all of your vehicles. I recommend a limit of $40 per day based on the average cost of a small rental vehicle. You can certainly bump it up if you will need more rental vehicle, such as a mini van or SUV.

An independent agent can help you pick the right limit and find a competitive auto insurance policy for you.

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Author: Pamela Dodge, CIC, CISR, CPIA, ACSR

Knowledgeable, creative insurance professional with 18+ years in the insurance industry, specializing in personal insurance programs.

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