It’s Vacation Time….Get up to speed on rental car coverage

It’s Vacation Time….Get up to speed on rental car coverage

June 13th, 2012 // 7:40 pm @

Does coverage’s on the Horace Mann auto policy extend to rented vehicles?

Rental cars generally qualify as either a Non-Owned Car (NOC) or as a Temporary Substitute Car (TSC) for certain coverage under the Horace Mann auto policy.

What if a rented vehicle is needed while the covered vehicle is out of use?

If you need to rent a car while your primary vehicle is being repaired or serviced or as a result of your primary vehicle being out of use due to breakdown, damage, or loss, then the rental is considered a Temporary Substitute Car (TSC) under your Horace Mann auto policy.

In this scenario, the Bodily Injury (BI) and Property Damage (PD) liability coverage’s on the policy for the vehicle that is out of use extend to the rental TSC, if it is used by:

  • the person named on the policy or his/her spouse (if the spouse resides in the same household);
  • relatives who live with the person named on the policy; or
  • any person using it with the policyholder’s permission and not otherwise excluded.

In addition, the Comprehensive and Collision coverage’s on policy for the vehicle that is out of use extend to the rental TSC, and the same deductibles apply.

What if a vehicle is rented while on vacation?

If you rent a car as your primary vehicle for vacation purposes, the rental car is considered a Non-Owned Car (NOC) under the Horace Mann auto policy.

In this scenario, the BI and PD liability coverage’s extend to a rental NOC if it is used by:

  • the named insured or his/her spouse (if the spouse resides in the same household); or
  • relatives who live with the person named on the policy. 

In addition, the Collision and Comprehensive coverage extend to the NOC rental (same deductible applies) if the rental vehicle is being driven by or in the custody of the insured, the insured’s spouse (living in same household), or the insured’s relatives (living in same household).

What types of rental vehicle do the policy coverage’s extend to?

Policy coverage’s extend to the rental of private passenger vehicles and SUVs.

 How long can coverage be extended to a rental vehicle? 

Coverage can typically be extended to a rental for up to 30 days.

Other things to keep in mind

Are you traveling to a state with no-fault insurance laws?

If so, you could be responsible for damage caused by an accident even when it isn’t your fault.  In that case if you did not opt for the rental company’s coverage, the claim could be paid out under your Horace Mann policy’s Collision coverage.  This may, in turn, impact your policy premium via accident surcharge points

Do you  have adequate coverage on their Horace Mann auto policy to cover damage to a rental vehicle?

If you do not carry Comprehensive or Collision coverage’s on their underlying policy, you could be responsible for paying out-of-pocket for all damages to your rental car. 

Does the Horace Mann auto policy pay for ‘loss of use’ for a rented vehicle?

No.  While a car is being repaired, the rental company obviously cannot rent that vehicle to other customers. The renter responsible for the damage could be required to pay for lost revenue, which would not be covered by the underlying Horace Mann auto policy.

Look for the next article in P&C Pointers’ summer series, which will cover emergency road service. 

Coverage’s, features/benefits and premiums vary from state to state and may not be available in some areas.  Refer to your state rules, rates and benefits pages for specific policy information.

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