What does rental car reimbursement coverage do?

Rental-car reimbursement (RREIM) coverage covers renting a car as a substitute for your vehicle when it is disabled, or is being repaired, after a covered accident.  Daily rental allowances or limits are subject to the terms of your car insurance policy.

Rental car reimbursement only pays for your rental car costs if the repair work is being done due to a covered loss.  If your car breaks down or has mechanical issues that are unrelated to a covered accident, then RREIM coverage cannot be used.

Rental car reimbursement coverage will typically only pay up to a certain daily limit.  Your policy will list the daily limit amount, usually $25 to $30, and total maximum limit, typically around $450 to $500. 

If you need to rent a bigger vehicle than the RREIM allowance pays for, or otherwise need to pay more for the daily rental cost, you will be responsible for the difference.

Is rental car reimbursement coverage mandatory?

No. Rental car reimbursement is an optional coverage.

What happens if I don’t have rental car reimbursement coverage?

If you don’t carry this coverage you may be without transportation, or have to pay out-of-pocket for a rental car, if your car is damaged in an accident where you are at-fault.  Also, if another driver is at-fault but uninsured, underinsured or their policy doesn’t cover a rental car, you may also be without transportation or have to pay personally for a rental car while your car is repaired.

If you have an extra vehicle at your residence that you can use while one is being repaired due to a car accident, then rental car reimbursement coverage may be unnecessary.