There are certain add-ons, called “insurance riders,” that are not typically included in an auto insurance policy, but that one may add on for a fee.
One of these common insurance riders to consider is rental reimbursement. Rental reimbursement covers the costs of a rental car if you should happen to get into an accident and need alternative transportation because your car is immobile. A rental may be necessary when your car needs to spend some time at the mechanic’s for repair after an accident, or in a worst-case scenario, if it is totaled and you need to purchase a new car. Whether or not you should add rental reimbursement to your insurance depends on your own unique situation.
The following quote from CarInsurance.org explains why rental reimbursement might be a good idea.
Here’s a scenario in which you’d want rental reimbursement: You’ve been involved in an accident that has rendered your car inoperable – it cannot be driven. Your insurer has deemed the automobile repairable, although there is significant body and mechanical damage that will require multiple days to fix. Even worse, the repair shop you want to perform the repairs has a significant backlog of over a week before they can even begin to get started on your car.
So you’re going to have to rent a car until yours is repaired, which likely will be two weeks minimum. The cheapest car rental place offers a sub-compact model for $15.99 per day, not counting your state’s tax or other fees that may be imposed. Plus, you’re used to driving a larger car, and one comparable to that will be $24.99 per day, plus taxes and fees.
Renting a car is not cheap, so having your insurance cover the costs of a rental may be beneficial if your vehicle is out of commission for a number of days. It is important to consider the price of a rental versus the added amount that you would pay to your insurance. Rental reimbursement is typically pretty inexpensive, so it may be a beneficial option to consider.
However, not everyone is an ideal candidate for rental reimbursement. Car Insurance Guru argues a counterpoint.
On the other hand, if you have other cars that you can use in case your main car gets damaged, then there is really no sense in spending extra money on rental reimbursement. Another scenario would be if you had relatives or friends who would be willing to lend you their vehicles. In this case, there is no need to pay for something that you probably won’t be using in the future.
If there are multiple cars within your family, rental reimbursement may be unnecessary if your spouse or other relative has the capacity to drive you where you need to be, such as work or school.
Insurance is meant to cover the uncertain, and unfortunately one cannot predict the future. An accident could occur at any time, and no one knows to what extent it will damage your vehicle. The best way to decide if you should add rental reimbursement to your insurance plan is to plan out what would happen if you did lose use of your car for a week or more. If you believe that you could find alternate transportation, then this is not a necessary add-on. However, if you would employ use of a rental car, then perhaps rental reimbursement should be considered.
Contact the agents at TJ Woods Insurance to learn more about our automobile insurance plans and determine which insurance riders are appropriate for you.
Have you ever had to pay for an expensive rental out-of-pocket?
