Does my state farm insurance cover rental cars ? – State Farm provides auto insurance for millions of drivers across the country. When you rent a car from a company like Enterprise or Hertz, your insurance coverage may not extend to the vehicle. However, if you have State Farm, your policy will.
State Farm, like many other insurers, provides coverage for rental cars that mirrors your own auto policy. In the event of an accident, State Farm customers can turn to their rental reimbursement coverage.
Find out how your State Farm auto insurance policy handles car rentals in the following text.
It’s true that State Farm provides coverage for rental vehicles.
Your regular State Farm auto insurance policy will protect you and the rental car you pick up with no extra cost.
Whether you’re renting a car or driving your own vehicle, State Farm will provide you with the same protection that you enjoy at home.
A good example is that if you have full coverage on your own vehicle, that coverage will also extend to your rental car. If you only buy liability insurance, the coverage on a rental car will be the same as on your own car.
Since you already have car insurance through State Farm, you can decline the offer of insurance from the rental agency. Due to limits and exclusions, it may still be in your best interest to buy insurance from the rental car company.
State Farm’s Rental Car Insurance Limits and Deductibles
Like other insurance companies, State Farm’s rental car coverage is subject to certain restrictions and deductibles. Before you rent a car, consider the following advice.
If you have an accident in a rental car, State Farm treats your claim the same way they would treat a claim for your own car—that is, you pay your deductible and they handle the rest. That means you’ll be responsible for paying the deductible before State Farm begins to pay for any covered expenses. It may be worthwhile to purchase the LDW/CDW from the rental car company if your deductible is high.
The Insurance Rates RiseMaking a ClaimIf you decline the rental car company’s insurance, State Farm becomes the primary insurer of the rental car. This implies that your claim will be handled in the same manner as if it were for your own vehicle by State Farm. If you caused the accident, your insurance rates will rise.If you get into an accident while driving a rented automobile, your insurance rates could go up for three to five years.
State Farm will cover your rental car expenses in all 50 states, DC, and Puerto Rico, as well as in Canada. However, this protection often ends once you leave these locations and rent a car elsewhere. For example, if you rented a car in Mexico, you would have to buy extra insurance from the rental company.
To illustrate, if you normally drive a $10,000 car but are renting a $30,000 luxury automobile, you may be seriously underinsured. You may be underinsured if State Farm uses the same coverage and limits for the rental automobile as you do for your own vehicle.
Even if State Farm pays to have the rental car fixed after a loss, the rental car company might tack on extra charges that aren’t covered under State Farm’s policy. Loss of use fees are a common practice among rental automobile agencies. In the event of a total loss, you could incur additional costs, including fees proportional to the decline in value of the car. You can avoid these charges by purchasing CDW or LDW from the rental car provider.
Non-Standard Vehicles (Like Moving Trucks or RVs) Are Not Covered: Insurer State Farm excludes from coverage any vehicle that doesn’t fit the company’s “standard” profile, including alternative-fuel vehicles, some sizes of rental trucks, and any vehicles with special features. For example, if you need to move and rent a truck or van, State Farm usually won’t cover it.
In the event that you need to rent a car for business purposes, your regular State Farm auto insurance policy will not apply. It’s more likely that you’ll need to either add business coverage to your existing State Farm policy or purchase additional coverage from the rental car company.
Formulation of State Farm’s Rental Car Insurance
State Farm’s rental car coverage works the same way as a regular auto insurance policy.
You can see how it functions below:
- You rent a car and have an active auto insurance policy with State Farm. Your existing auto insurance coverage with State Farm should cover the rental car.
- If you hurt someone with the rental car you got from State Farm, your liability coverage, which is required in most places, pays for the damage.
- If you damage the rental vehicle in an accident, or if the rental vehicle is stolen, then State Farm covers the loss via your comprehensive or collision coverage. You pay your deductible, and State Farm pays for the rest of the costs to fix or replace your car.
- Your State Farm premiums will increase once you file a claim. If it was your fault and you don’t have accident forgiveness, your insurance rates will go up for three to five years.
What You Need to Know About Rental Car Insurance
Does having State Farm allow you to decline the rental car company’s insurance? If you want to give a good answer to this question, you need to know how insurance works with rental car companies.
A loss damage waiver (LDW) or collision damage waiver (CDW) is available from every car rental agency (LDW). If you have this insurance, you won’t be responsible for paying for repairs to a wrecked car.
The cost of CDW/LDW ranges from about $10 to $50 each day. Should you cause damage to the rental car, the agency will file a claim with their own insurer. There is no need to contact State Farm and no need to set aside money for a deductible.
Optional insurance packages provided by rental car agencies typically include coverage for lost or stolen items; injury protection; medical expenses; and roadside assistance. Your personal belongings in a rental car are protected by your existing homeowner’s or renter’s insurance (which means you will receive compensation if someone steals your luggage). If you already have health insurance, there’s no reason to get PIP or medical payment coverage from the rental car business.
If you have a comprehensive policy with State Farm that has high liability limits, you can usually forego the rental car company’s insurance and drive the vehicle without worry. However, drivers who have State Farm insurance with low limitations may need to get additional coverage.
The Details of State Farm’s Rental Reimbursement Insurance
State Farm also provides rental automobile insurance, but it’s called rental reimbursement coverage. If you get this additional coverage, State Farm may pay for your rental car expenses after an accident.
Usually, you may get your rent paid for an additional $5–$10 per month. After adding it to your policy, State Farm will pay for your rental car costs in the event of a covered loss.
State Farm will pay for a rental car up to a daily maximum if your regular vehicle is damaged beyond repair or stolen and you need one to get around.
State Farm’s Rental Car Insurance: A Closing Remark
Most insurance companies, including State Farm, will cover you when operating a vehicle that is not your own, such as a rental car.
Depending on the terms of your insurance, State Farm will pay for repairs or a replacement if your car is stolen or damaged. If you hurt someone or damage their property while driving a rented car, State Farm will pay for their medical bills and repair costs.