What Happens When There’s a Rental Car Accident?
A car accident is a terrifying experience. The suddenness of the crash combined with the gut-wrenching feeling that your entire day, week, etc. got a whole lot worse makes the experience one you want to forget.
As bad as the crash is, it often feels worse when you get hit in a rental car. Who is responsible for what becomes blurry? Should you have taken the offer from the rental company for their insurance? Does your car insurance cover you for this accident?
To clear up the picture, we want to address some of the uncertainties when you are in a rental car accident.
WHO IS AT FAULT
Before we get into what happens, we need to know who is at fault for the accident. California is an at-fault state. The police create a report at the scene of the crime detailing whom they believe is at fault for the crash.
However, the final decision on who is at fault happens in the courtroom. That is because a police report is an opinion of events, albeit from a reputable source. Still, police officers make a split decision at the scene of the crime.
It can take weeks or months to gather all the information needed to make a coherent case for some car crashes.
Assuming the other driver is at-fault you can go after their insurance. The question becomes how much coverage they have and is it enough to pay the damages to the car.
The good news is California’s minimum insurance policy is 15/30/5, so at least you can get most economy rental cars covered for the majority of accidents. For example, a popular rental car is the Toyota Yaris. The car retails for around $15,950 – $17,050.
Since most rentals are economy, it is a good chance your car can get fully covered under the other drivers’ policy even if they were underinsured.
Furthermore, if you decided to take the rental insurance, you get what is called a loss-damage waiver (LDW). The LDW means the rental car company does not come after you for vehicle damage or theft.
The challenge is not everyone takes the LDW. The reasons vary since many insurance companies do cover rental cars in the United States. However, you should contact your insurance company ahead of time to make sure they cover you in a rental car crash.
WHAT HAPPENS IF THE OTHER DRIVER IS UNINSURED OR UNDERINSURED?
Even today, about 12.6% of all drivers on the road are uninsured according to the Insurance Research Council. To put this number in perspective, one out of every eight drivers carry no insurance.
Additionally, the Insurance Information Institute states 78% of insured drivers purchase a comprehensive coverage policy with their liability insurance, not everyone does. Many of these drivers take the states minimum coverage.
WHAT HAPPENS IF YOU NEED TO GO THROUGH YOUR INSURANCE COMPANY?
Sometimes you run into a scenario where the other driver’s insurance does not cover everything, and you did not take rental insurance from the company. At this point, you need to check with your insurance company to see whether they can cover you.
Unfortunately, many people opt out of the $1-2 per month rental car coverage benefit. However, if you plan on renting a car, it is good to have. Then your insurance company can cover you for an accident, theft, or vandalism to your vehicle.
GETTING A RENTAL FOR YOUR RENTAL
You are in a rental car and get hit. The car is not drivable, but you are safe. At this point, you need a rental car to replace the rental car in the accident. Contact the insurance company to get a new rental car to replace the damaged one.
Often the insurance company can provide you with approved rental companies. Keep in mind if you drove a sedan beforehand, don’t rent a luxury sedan this time and expect the insurance company to pay. It should be an even transfer of cars.
Additionally, it is sometimes challenging to get money back from the other driver’s insurance company. You do need to be patient.
You might need to pay for the rental car up front in some cases, and then get reimbursed from the insurance company along with the rest of your claim after the crash settles.
Getting into a car accident can be scary. However, working with insurance companies and rental car agencies should not be. Therefore, you need a trusted advisor who can help you through this process.