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Rental Car Accidents and Insurance

When you drive a rental car, you are likely to be in a city or state where you are unfamiliar with the roads or the laws. If your rental car is involved in a collision, it can be very stressful and you may be uncertain of your legal position. It is important to understand the process for handling rental car accidents and what to expect from the insurance company.

What happens if my rental car is in an accident?

If you are involved in a collision while driving a rental car, you may have to pay at least part of the cost of repairs for the damage you caused even if you were not the driver at fault. When you rent a car, the rental company requests proof of insurance to check that you have at least the minimal level of liability insurance required by Alabama law and to find out how much your deductible is.

Does my insurance cover the damage?

To a large extent, your liability depends on the insurance option you chose when you rented the car:

  • Declined further insurance. Many car insurance policies provide coverage for rental cars, but if you are subsequently involved in a collision you are required to pay the deductible to the rental company up front, even if you were not at fault. If your policy does not provide coverage for the cost of renting a replacement car after a collision, you have to pay the rental company for the number of days the rental car is out of action due to repairs (loss of use). Even if your policy does provide rental car coverage, it may be limited in value, and you may have to pay the difference to the rental company.
  • Extra insurance. If you bought extra insurance, the policy may cover all damage to your rental car and any other damaged car, even if you were at fault. This depends on the exact terms of the policy. You may have to pay the deductible in some cases. If the extra insurance provides only limited coverage, your insurance policy on your own car usually bridges the gap.
  • Collision damage waiver (CDW). If you purchased CDW, all damage to the rental car itself is covered. However, it does not necessarily cover your medical costs for injuries or damages to another car if you are at fault. CDW often does not cover damage to tires or the chassis, and you may still have to pay a reduced deductible for the damage to the rental car.

Don’t let insurance companies take you for a ride

Insurance companies do their utmost to avoid paying settlements even when they should. Make sure you hire a dedicated Alabama auto accident lawyer who knows how to handle insurance claims.