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Rental Car Accident Insurance

Traffic accidents in rental cars are inevitable in the travel industry,  and many safety devices have been created to make rental cars safer for those people on vacation who decide to rent a car.

Even so, car accidents in rental cars are still extremely dangerous and happen all too often in the United States, there is one car accident every 15 seconds. Worldwide, 1.2 million people die each year in traffic accidents.

These numbers are staggering, and unfortunately we see the results of car accidents (major and minor) everyday here at Avrek Law.

What Does Your Personal Car Insurance Cover?

The insurance that covers your own car is the first line of protection to cover a rented vehicle. Never drive without insurance in California – period.

This of course gives you basic liability coverage for damages you could cause to other people with the rented car and other vehicles and property.

If you do not own an automobile and, therefore, do not have vehicle insurance, you can and should buy a temporary or annual insurance policy from an insurance company. Such a policy should be reasonably priced.

In order to protect a rental vehicle, your personal insurance must also have collision coverage (which covers damage to your own vehicle because of an accident with another vehicle or object or by rollover) and/or a comprehensive coverage (covering damage to your vehicle caused by causes other than a collision, such as fire, theft, vandalism, flooding, fallen tree branches, etc.).

If you have any of these coverages, check the text in the small print to know exactly what the coverage involves, or better still, call one of the representatives of your insurance company’s customer service and ask the specific characteristics of your policy.

Should You Buy Additional Coverage From a Rental Agency?

Car rental companies offer a wide variety of alternatives to secure a rental car.

There is insurance that is necessary to take, and others that are optional, depending on the use that we are going to have for the vehicle, the budget we have and the personal tranquility we need when driving a rental car.


Collision Damage Waiver or Loss Damage Waiver insurances cover damages for thefts or accidents that we may have during the time of the rental of the vehicle.

These insurances are offered with and without franchise. In insurance with franchise, the insurance company is responsible for covering up to a certain amount and after that amount, the difference is charged to the insured. In the coverage without franchise, it is the insurer that covers all of the damages.

CDW and LDW insurance do not cover damages caused to third parties.

It is important to know that the coverage offered by insurers is void in cases where the person who rents the car has shown negligence in the use of the vehicle (for example, driving under the influence of alcohol or drugs, loading the wrong fuel, etc.)

This insurance costs an average of $27 – $30 a day when purchased directly at the renter’s counter.

What To Do After a Rental Car Accident?

In case of an accident, it is essential that you contact the rental company immediately: it will guide you through the steps to follow regarding how you must deal with the accident and contact the authorities according to the seriousness of the incident.

It is the client’s right to receive another car of similar characteristics to the previous rental – according to availability – when the vehicle involved in the accident cannot be driven safely.

In turn, in its discretion, the rental agency can refuse to deliver a replacement car and terminate the rental contract if there is evidence that the damage to the vehicle was due to misuse of your part or if you broke any rental conditions (driving on unpaved roads, driving under the influence of prohibited substances, etc.).

To make insurance coverage effective, keep in mind that it is mandatory to deliver the accident and/or police report to the renter.

Lastly, it is good to know that the assistance rate on the road is always included in the price, unless it is explicitly stated otherwise in the rental conditions.

Read an in depth article about what to do after being involved in car accident or as a passenger in a crash.

Extra Insurance From Credit Card You Paid With

It is important to know that different car rental companies can put special codes to their insurance, but there are three:

  • Stolen vehicle
  • Crashes
  • Damage from or to third parties

In addition, what insurance does the credit card cover? Only the first two, so you will have to pay for any third party damages.

That is the most important of all because the value of an accident can far exceed the value of the car in case of theft or total loss.

Third-party damage insurance is the one that covers accidents that involve other people, either drivers or pedestrians.

That is why it is important to look at that details.

In addition, there are special conditions for credit card insurance such as that they do not cover certain luxury cars, of that cars must have a maximum of eight seats;

this is a problem in California, with some SUVs rented in the Los Angeles area having nine seats configurations.

Obviously these policies don’t cover those 15-seat vans.

These specifics can be verified by reading the Visa or MasterCard conditions on their website.

Can a Rental Car Company be Liable?

Although most cars are rented with coverage without franchise and will protect you in different eventualities, under certain circumstances you may run out of coverage.

A clear example is when after an accident it is proven that you have driven under the influence of alcohol or prohibited substances; in this case no insurance will cover the damages and the renter will fully charge the amount.

We remind you that driving under the influence of illegal substances is also reason for the revocation of your visa if you are a foreigner.

Other damages that are not covered by insurance are loading the car with wrong fuel, losing the keys, and in general all that may come from obvious negligence on the part of the contract holder.

If the rental company is proven guilty of renting you a car with mechanical problems it can be held accountable for the damage if you file a lawsuit.

Do I Need a Police Report?

Having a police report after the accident is one of the most important issues in a rental car accident.

It can be a powerful asset in any claim you want to do with your insurance company, and a police report will state the facts on the event and determine who was at fault.

Be sure to ask for a copy after it’s filed by the police officer.

Worst Rental Car Companies

Top 3 Rated

  1. Enterprise
  2. National
  3. Alamo and Hertz (tied)

were the top 3 brands for overall satisfaction among major car rental agencies, a study finds.

3 Worst Rated

  1. Dollar
  2. Thrifty
  3. Budget

So what can you do to find the right car rental company?

Well, to begin, you should read the fine print and know what taxes you can expect to pay.

Request that you are given the type of car you asked for or be given a free upgrade. Avoid useless add-ons like prepaid gas.

Finally, think whether you really need to rent a car at all.

After considering the extras involved, like parking fees, fuel, and valet gratuities, you might just opt for public transportation instead.

Filling a Claim After a Rental Car Accident. Do I Need a Lawyer?

After experiencing an accident in a rented car (and having back pain, whiplash, broken bones, or even internal injuries), the compensation will be immobilized until the amount of damages is determined.

The companies usually take between 30 and 60 days to give you an answer, although it could be less.

If you lose the claim but were insured by a third party (your personal policy, credit card, or an outside car insurer) keep in mind that it generally does not work like other policies that have an ‘understanding between insurers’ – you will have to pay whatever you need to pay and then ask the insurer for the money.

The important thing to know is that you will not have to pay more than your insurer (except maybe management expenses), that the responsibility is of the company.

You should hire a lawyer experienced in rental car accidents to help you start a lawsuit if you feel you have been ripped off by your insurance company.

Having a personal injury lawyer could determine whether you get any compensation or not.

Main Causes of Rental Car Accidents

The increase in the number of rented vehicles in California has grown immensely over the last decade. This inevitably leads to a growth in traffic accidents related to rental cars.

There are a few causes of these accidents:

  • Not making sure the rental car is in a good condition.
  • Drinking alcohol or using drugs before driving.
  • Driving too fast.
  • Not respecting pedestrians.
  • Not sleeping properly before you are about to drive.
  • Not keeping a safe distance from the vehicle in front of you.
  • Using the cell phone or anything that can distract you while driving.
  • Ignorance of local traffic laws.
  • Not knowing the surroundings.

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