When your car has been in an accident and the repair cost is covered by your insurance claim, you might heave a sigh of relief for a moment before the thought of arranging a mode of transport for next week dawns on you.
Now, you only have two options to choose from, either you take public transport to commute to work and other places or you use a rental car service. But the fare of these modes of transport can be a burden on your pre-planned monthly expenditure plan, so how do you take care of that? That’s when rental car reimbursement steps in.
Rental car reimbursement is a feature under your car insurance policy that covers your rental car service or public transport while your car is under repairs after an accident.
Drivers often wonder if the rental car reimbursement is actually worth it. After all, you are not getting it for free, you have to pay an additional amount on top of your usual insurance premium to access that facility, and as it is always said before you plan investments, it is very important to evaluate the expected return.
In this article, we will discuss reimbursement insurance in detail. If you are from Calgary and want to check out the exact pricing and plans for your car insurance, find out more here.
What Is Rental Car Reimbursement?
Rental car reimbursement is a special add-on to your insurance policy that takes care of your commuting expenses whether it is through a rented car or through public transport when your car has been in an accident and is getting repaired in a garage.
However, there is one thing that you need to keep in mind and that is you will only get the benefits of rental car reimbursement if your car qualifies for the insurance claim in the first place. This feature is just an add-on and is not applicable unless the insurance company investigates the accident and approves your insurance claim.
Is A Rental Car Reimbursement Really Worth It?
Before you delve deeper into this topic and learn more about rental car reimbursement, it is important to determine if you really need it.
Yes, rental car reimbursements are totally worth the investment. For example, let’s say your car was in an accident in which it was severely damaged and it will take about a week to get it fixed in the garage. Now if you are someone who has been using their car to commute for years, then a crammed public transport might not be your favorite alternative. So the next best option that you have is to rent a car. The cost to rent a car for a week is approximately $370 in Canada. Now, this amount is large enough to impact your finances and that’s when rental car reimbursements come in handy. The additional cost needed for rental car reimbursement isn’t much and hence is a more reasonable option to choose.
Although the monthly charges for rental car reimbursements aren’t high, when you pile them up and calculate annually, it does amount to a big chunk of money and if your luck is in favor, you might not have a single accident that year and all that money can go to waste.
So which is a better option? To opt for rental car reimbursements or not? Well, it depends on you. You have to weigh your options and decide for yourself. If you think that you are prone to frequent accidents then you should definitely opt for a rental car. After all, it’s always better to be on the safe side.
Do All Insurance Cover Rental Car Imbursement Automatically?
No. Rental car reimbursements are an additional facility that you would have to add to your policy at extra cost.
Speaking of an insurance policy, there are two main categories of insurance for cars: Comprehensive and Collision.
Under Comprehensive, no matter what damages your car, whether it is a natural calamity, an animal attack or even if it is stolen, you will qualify for insurance cover, and under Collision insurance, you can only claim a cover if your car met with an accident.
For both these cases, you will need to add rental car reimbursement to your existing plan to take care of your commuting expenses in case your car is in a garage getting fixed.
Things To Know Before Opting For A Rental Car Reimbursement
The actual cost and the terms and conditions of the policy vary from company to company but there are a few common things that you need to keep in mind before opting for rental car reimbursement:
- Rental car reimbursement only applies if your car is in an accident and your insurance company has investigated the accident and approved your insurance claim. Keep in mind that this benefit does not apply when your car is in the shop for routine maintenance.
- You need to check out the limit of your rental car reimbursement. Your plan will have a daily limit and if you exceed it, you will be required to pay the extra cost from your own pocket.
- In most cases, if you have auto insurance with the rental car reimbursement add-on, it will automatically be extended to the car you rent and you won’t have to purchase additional coverage from the rental car agency.
- The annual cost of getting the rental car reimbursement add-on is approximately not more than the per day charge of a rental car.
EndNote
It is always a great idea to add rental car reimbursement to your car insurance plan. After all, smart future planning includes taking care of and planning for unforeseen emergencies in the future and being prepared for everything. Plus, it might add a tiny extra cost to your monthly plan, it will definitely save your wallet from a much bigger expense in the future.