After a vehicle accident, a rental car may be provided in one of two ways. First, once a liability insurance carrier for an at-fault driver has accepted liability, they are responsible for paying the cost of a rental vehicle from the date of the accident. The length of time, however, depends on whether the vehicle is declared a total loss or is repairable. If the vehicle is a total loss, once they have extended an offer for the value of the vehicle, their liability will end. Most insurance carriers will extend payment for a rental vehicle for two or three days to allow for payment to be received. If the vehicle is repairable, the liability insurance carrier is responsible for paying for alternative transportation until the repairs are complete.
If the liability insurance carrier for the at-fault driver has not accepted liability, a driver may still be able to obtain a rental under their own automobile insurance. Rental reimbursement is often sold in connection with the collision coverage. Many carriers require, however, that in order to obtain a rental under rental reimbursement that a collision claim must be made. The same time frames apply to a rental under rental reimbursement that applies to a rental provided under liability insurance.
It is important to note that while liability insurance and rental reimbursement coverage both provide for a rental vehicle, there are limitations. Optional insurances such as collision deductible waiver and incidental damage waivers offered by rental car companies are not covered. Also, if the individual renting the vehicle does not have collision coverage on their own vehicle, it will be necessary to purchase collision coverage at a daily rate to cover the rental car. This is not covered by liability insurance.
Finally, if a rental replacement vehicle is not requested, an individual may still be entitled to compensation for the loss of use of their vehicle. Loss of use is calculated based on what a replacement vehicle would have cost during the time the individual would have been entitled to a replacement. This claim is most appropriately made when dealing with vehicles that are not the primary means of transportation, such as recreational vehicles.