How Long Will Insurance Pay for a Rental Car After an Accident?

What Is Rental Reimbursement Coverage?

Rental reimbursement coverage is an optional add-on to physical damage coverage (collision or comprehensive). Most insurers require a policyholder to carry both collision and comprehensive coverage to add rental reimbursement coverage. Ensure you check with your insurer to confirm this.

This type of coverage activates when a policyholder’s vehicle is being repaired due to a claim covered under one of their coverages. Additionally, it must have been purchased before the incident occurred.

What’s Covered vs. What’s Not

Rental reimbursement coverage pays for a rental vehicle while your vehicle is being repaired due to a covered claim. It covers daily rental charges, including fees and taxes.

You can’t use this coverage when your vehicle is in the repair shop for routine maintenance, such as an oil change or a wheel alignment. It also does not apply when you rent a car while on a trip.

Moreover, the rental car coverage after a car accident does not cover the security deposit, fuel costs, or extra mileage charges. You will take care of these costs after renting a car.

Coverage Duration Explained

A damaged car often takes a few weeks to be repaired. Minor damage, such as a scratch, small dent, or paint transfer, can be repaired in one to five working days. Moderate repairs like replacing a bumper or door, fixing alignment, or repainting usually take seven to 14 days.

A car that’s severely damaged can be at a repair shop for at least three weeks or longer. Examples of major repairs are frame straightening and replacement of the engine, transmission, airbags, sensors, or suspension.

The 30-day coverage duration for rental car reimbursement insurance considers the typical repair periods for damaged cars. Coverage ends immediately after your car is repaired and returned to you.

Repair Timeline vs. Total Loss Timeline

While the repair timeline is 30 days, a different timeline applies when your vehicle is determined to be a total loss. In such an instance, rental reimbursement coverage ends seven days after a final settlement offer is made.

Insurers consider one week to be a “reasonable” period for the insured to have purchased a new vehicle. It’s standard practice, but you can negotiate for a few more days.

Coverage Limits: Daily Caps and Maximums 

Many insurance companies in Nevada provide daily limits for rental reimbursement coverage for $15 to $50, often capped at a maximum of $450 to $1,500. For instance, a policy may be $15/day up to $450 or $30/day up to $900. Always confirm if the stated daily limit only covers the base rate or includes fees and taxes.

When you choose a smaller, cheaper car, even if you are eligible to get a larger one, you may have the car for more days. If you rent a luxury car that exceeds the daily limit, you will be responsible for the difference.

Before leaving the rental company, always check the car and take photos to protect yourself from being accused of pre-existing damage.

Fast, Reliable, And Thorough Service For All Accident Victims

The days after a crash matter most. Our team is available 24 hours a day to respond quickly, coordinate treatment, and communicate with insurers. We handle every part of your case from start to finish, including paperwork, negotiations, and claim strategy, so you do not have to worry about missing a step. Fast, reliable, and thorough service is how we approach every auto injury case.

Fault Determination: Who Pays?

The answer to who covers rental costs after a car accident depends on fault.

If another driver causes the accident, their insurance company is required to cover your rental costs through the driver’s liability coverage. If you are at fault for the accident, your insurance company will cover your rental costs, if your policy includes rental reimbursement coverage. This coverage may also be used if an at-fault driver is uninsured or underinsured.

When liability is disputed, and you have rental reimbursement coverage, your insurance company can cover your rental costs and then seek reimbursement later from the at-fault driver’s insurance company, once liability is established. 

If you are found to be partially at fault for the accident (50% or less), your compensation, which includes rental costs, will be reduced by your degree of fault.

It’s crucial to build a strong case against the other driver. You can do this by gathering solid evidence. Immediately after the accident, if you can safely move around, you should document the scene. If you are unable to move, ask someone to help you.

Take photos and videos of the accident scene, documenting the position of the vehicles and damage from multiple angles. You should also take photos of the road conditions, skid marks, road signs, traffic signals, and your injuries.

Furthermore, collect the names and contact information of witnesses and possibly brief statements. And if the accident results in bodily injury, death, and damage to property to an apparent extent of $750 or more, report it to the police and obtain a police report. Don’t forget to preserve records, including receipts of the rental charges.

With such evidence, you can establish liability, proving the other driver is responsible for covering your rental costs.

If liability is disputed and you lack rental reimbursement coverage, you will have to pay for your rental car out of pocket. If you do this and it’s later established that another driver was at fault, you can seek reimbursement from their insurance company. 

Working with a personal injury is integral to ensuring you follow the appropriate steps and gather solid evidence to protect yourself.

Filing With the At-Fault Insurance

Even if you are not at fault, you should first notify your insurer about the accident. Then, you can file a claim with the at-fault driver’s insurance company to cover your rental costs. To do this, you will need to contact the company, informing them of the accident.

The insurer needs to acknowledge your claim within 20 working days and then initiate an investigation, which will include reviewing evidence, such as police reports, witness statements, and photos.

When they confirm their policyholder was negligent, they’ll need to officially accept liability. At this point, you can obtain a pre-approval for repairs, which often involves the company setting up direct billing with a rental agency.

Chances are that the at-fault insurance also has daily limits and maximums for rental reimbursement coverage, just like your insurance company. But generally, they will provide a vehicle comparable in size to your damaged vehicle.

But what if you need to rent a vehicle and pay out of pocket before the insurer completes their investigation and accepts liability?

You can submit the rental agreement, the repair estimate, and receipts for reimbursement when sending the formal demand letter. This letter initiates final settlement negotiations for all damages. It’s recommended to send it after reaching maximum medical improvement (MMI). This means after medical treatment or when your condition is stable. 

The letter should provide details on how the accident happened, how the other driver is liable, and a description of your injuries and other damages suffered, which includes renting a car while yours was being repaired. Send the letter to the insurer with supporting documents.

Nevada insurers are generally required to respond within 30 working days after receiving a demand letter. The at-fault insurance company may accept your claim, give a counteroffer, or reject it.

Issuing a counteroffer initiates negotiation until a settlement is reached. If a settlement can’t be reached or the insurer denies liability, you can consider litigation.

Delays and Coverage Exhaustion

Rental reimbursement coverage lasts until repairs are done, or limits are exhausted. If your car is repaired and returned within five days, you will not have 25 more days. Your coverage will cease immediately.

If repairs take more than 30 days, you may need to pay your rental out of pocket for additional days, especially when a delay is not caused by the insurer. For instance, when a shop delays repairs because they are waiting for imported parts to arrive, or due to a labor shortage.

If a repair shop finds hidden damage and has to pause work until it receives approval from the insurer, you may request an extension from the insurance adjuster.

Coverage Denial and Delays

An insurance company may delay reimbursement. For example, when the at-fault insurance company states it needs more time to investigate the accident to determine liability. Every additional day they spend investigating the case translates to you spending more days without your vehicle. 

If you are claiming coverage from your insurer, the company will need to confirm that you purchased the rental reimbursement add-on and that the incident is covered. For instance, if your policy excludes drunk driving, your insurer may need time to confirm if you were driving under the influence of alcohol when the accident occurred.

Additionally, the other driver’s insurer may deny covering your rental costs if they dispute liability. And your insurer may deny your claim if the incident is not covered by the policy.

Your Protection and Escalation 

When an insurer denies your claim for rental reimbursement and other damages, you should review the denial letter to understand the reason for the denial.

Then, gather evidence that contradicts the reason and file an internal appeal. If the appeal is denied, you can file a complaint with the Nevada Division of Insurance.

Rental Payment Methods

Many insurers in Nevada partner with rental agencies and pay them directly. However, some insurers pay rental costs using credit/debit cards or reimburse for out-of-pocket costs.

Special Situations and Alternatives 

Some policies cover special situations and alternatives. For example, you may be allowed to extend coverage caused by certain delays. And some insurers cover alternative transportation, such as public transportation and rideshares (Uber and Lyft).

Critical Action Checklist

When you are involved in a car accident and your car needs to be repaired, you should:

• Confirm you have rental reimbursement coverage
• Get pre-approval
• Understand limits
• Monitor repairs
• Return your rental car immediately after repairs are done

Renting a car while yours is being repaired after an accident can be costly. Contact our auto accident lawyers today to receive what you deserve.

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