Rental car insurance is an optional coverage that helps pay for a rental vehicle if your everyday vehicle needs repairs following an accident.
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Having your car in the shop for even just a short period can turn into a major disruption if you have no other transportation. Rental reimbursement insurance from Geico can make the process easier by helping to pay for the cost of a rental car.
It’s an optional peace-of-mind coverage that you can add to your everyday auto insurance policy. If you’re involved in an accident, within a day or two, the insurance clears the way for you to rent a car for little to no cost to you.
Geico is one of the best car insurance companies to get this coverage from. This insurance is affordable and gives you a few options for setting your coverage limits, and adjusting them up or down depending on the rental you’ll need and how much you want to pay out of pocket.
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Our Top Pick Our Top Pick Best ‘cancel for any reason’ coverage Fast and easy online sign-up 5+ customizable coverage add-ons Quick claims filing & reimbursements Best for comparing costs Compare 12 companies instantly A+ BBB rating Over 100k 5-Star reviews Best for families 1 child covered for free Adventure sports and pet add-ons 6+ plan options Best for trip interruption coverage 24/7 concierge assistance 175% interruption coverage A+ BBB ratingGeico offers rental car insurance among the many optional add-ons of its insurance menu. Often referred to as “rental reimbursement insurance,” this coverage helps pay the cost of renting a car if your vehicle is in the shop for repairs after a covered accident. The insurance costs only a few dollars per month and could save you much more money if you ever need it. If you haven’t rented a car recently, you might be surprised at the cost.
According to the Consumer Price Index by the U.S. Bureau of Labor Statistics, U.S. rental car costs rose nearly 50% following the pandemic in 2020. While prices have come down since then, they’re still higher than they were pre-pandemic.
The amount you’ll pay for a rental car depends on a number of things, including:
The popular travel site Kayak lists rental car prices in the range of $17 to $100 per day. However, depending on the type of car and location, a rental could cost significantly more than that. For example, a top-of-the-line, high-end vehicle like a Lincoln could cost you as much as $250 per day.
Geico’s rental car insurance covers the cost of renting a car. If you were involved in a covered accident (meaning Geico or the other driver’s insurance is paying your insurance claim) and you need to rent a car while your car gets repaired, Geico’s rental car insurance would help. If you’re not at fault for the accident, the at-fault driver’s insurance will likely pay for your rental car.
It covers the cost of renting a car up to the limits you choose when you buy your policy. Limits vary, but when gathering quotes for rental car insurance, you can expect to see limits like:
If you select $50/$1,500, Geico will pay $50 a day or up to $1,500 total for a given accident — whichever cap you hit first. If you rent a car at $50 per day for five days, the cost would be $250. But if you rent a car at $50 per day for more than 30 days, your coverage would max out at the $1,500 mark. You would have to pay out of pocket for any additional days you need the rental car.
Geico rental car insurance reimburses everything unless you rent a car from Enterprise. In that case, Geico will pay for your rental directly, which means no out-of-pocket cost for you.
When choosing your limits for rental reimbursement insurance, keep in mind the type of vehicle you need day to day. If you’re used to having a luxury car or if you need a larger vehicle, like a van or truck, consider setting higher limits to cover the higher cost of replacing your vehicle.
Rental car reimbursement coverage covers only the cost of renting a car when you’re in need of transportation after an accident. It doesn’t cover ancillary expenses, such as:
*Geico doesn’t provide additional coverage for the rental car, but if you have collision and comprehensive insurance already on your policy, this will likely transfer to your rental car temporarily.
It’s worth noting that you can only use rental reimbursement coverage if your car is in the shop as the result of a covered accident — meaning your insurance company approved and is paying for your claim.
If your car breaks down or is with the mechanic for routine maintenance, rental reimbursement coverage doesn’t apply. In the case of a standard mechanical breakdown, Geico offers mechanical breakdown insurance.
To answer this question, it’s important that we clarify something, because this is where it gets confusing. As mentioned, Geico’s rental car insurance provides limited reimbursement for the costs of actually renting the car.
However, if you have collision and comprehensive insurance on your Geico policy, these insurance types — not Geico’s rental car insurance — will temporarily insure the rental car while your actual car is in the shop. However, you’ll only get comprehensive and collision coverage.
Geico’s “rental car insurance” is a bit of a misnomer because it’s technically rental car reimbursement coverage. When you see this latter term specifically being used in the insurance industry, it’s referring to your insurer paying you back (partially) for renting the car, but not paying for its damages or your bodily injuries if you get into a car accident.
It’s very common that car insurance companies will automatically protect your rental car anyway under comprehensive and collision coverage. In the industry, the term “rental car insurance” usually means insuring a rental car — not paying for the car’s use over a few days. This is typically offered by rental car companies themselves or by your credit card company.
Since Geico will only provide whatever amount of comp and collision you already have on your policy for your rental, you may want more coverage. You can often get this through the rental car company itself or your credit card company. The latter only applies if you pay for the rental with a credit card, though.
Check with your credit card company to find out what it covers before deciding whether to buy more rental insurance. You may be sufficiently protected already.
If you don’t have collision coverage on your auto insurance policy, you sometimes can buy a collision damage waiver (CDW). While it’s not full insurance coverage, a collision damage waiver ensures that you’re not on the hook for any collision damage that may occur to the rental car.
This waiver only applies to collision damage. It doesn’t cover liability-related expenses, including bodily injury and property damage. Additionally, a collision damage waiver doesn’t cover theft. To protect against theft, you’d need to buy what’s known as a loss damage waiver (LDW).
Like most insurance coverages, rental car coverage easily pays for itself if you ever need to use it. However, you should consider some things before adding it to your car insurance policy, including:
If you would have a hard time getting through a week or two without your car and you don’t have cash set aside for emergency expenses (like renting a car), then rental reimbursement coverage could absolutely be worth it. Keep in mind that you may be paying for something that you may never need to use. It’s up to you how much risk you’re comfortable with.
Rental car insurance from Geico is an optional coverage that’s easy to add to your auto policy and could be worth the money if you need to use it.
If your car’s ever in the shop for repairs following a covered accident, rental reimbursement insurance would pay the cost of renting a new one in the interim and could save you a few hundred dollars or more. If you don’t have money set aside for emergencies like this, rental car reimbursement could be a worthwhile investment.
However, rental car reimbursement coverage isn’t just offered by Geico. You can find these coverages with State Farm, Progressive and others. Check out our reviews for State Farm or Progressive. You can also compare the providers with each other or with Geico:
