Rental car fender-bender
January 17, 2006 8:38 AM   Subscribe

I was recently in a fender-bender in a rented car and I want to know who covers whom.

I was a registered driver of a van and scraped the corner of a neighbor's car as I was parking it. We had paid for the insurance option but now the rental company is saying that this insurance only covers their car not my neighbor's car. My friend's credit card was used to pay for the rental (he was the primary renter) and I am insured to drive my own car. It will be very difficult to pay out of pocket for the repairs. Am I covered by anyone? What are my options? Thanks for any help.
posted by Corpus Callosum to Law & Government (7 answers total)
Check your own insurance policy to see if it covers rentals. There is often a rider on some policies to cover any liability you may have when driving a rental car. I'd try reading through your policy information before calling the company, but if you have a local representative they would be a great source for information.

Although it probably isn't likely because you haven't mentioned it, you may have used a credit card that provides some additional coverage for car rentals. Check if it was an American Express or something of that sort.
posted by mikeh at 8:48 AM on January 17, 2006

I'd also have the neighbor get an estimate. Even if this could be a claim on your own car insurance, it might raise the premiums more than paying out of pocket would.
posted by mikeh at 8:49 AM on January 17, 2006

Response by poster: Thanks, mikeh.
I'm checking these out now.
posted by Corpus Callosum at 11:05 AM on January 17, 2006

When you purchase the insurance on a rental car, what you're buying is Comprehensive and Collision, which are indeed used to pay for the damage to the rental. Your Liability coverage should extend while driving a rental, and (Bodily Injury and Property Damage) would cover your neighbor's car.

If your neighbor is willing, it's definitely advisable to see if the repairs are inexpensive enough for you to cover personally, as mikeh suggested - if your premiums go up, they will likely be raised for three years. However, keep in mind that your neighbor can also make a claim against your insurance himself if he decides to.

If, as you stated, it will be difficult for you to pay out of pocket, I'd recommend calling your insurance company. Additionally, because it was your friend who actually rented the vehicle, his policy might be primary for Liability coverage. It just depends on what type of contract you have, and the laws in your state.

And take heart. If your insurance policy is used as the primary Liability coverage, you may have a benefit like accident forgiveness, which would prevent your premiums from being increased.
posted by mewithoutyou at 3:02 PM on January 17, 2006

Response by poster: Are rental cars required to carry liability insurance? (NJ rental, bang up in NYC)
I was under the impression the impression that my own liability insurance only covers my car, not the rental.
posted by Corpus Callosum at 3:38 PM on January 17, 2006

Best answer: Your Liability coverage actually extends to any vehicle that you drive, which is why rental car companies offer Comp and Collision. They assume - and usually mention during the renting process - that the renter's own policy will take care of the Liability portion.

Insurance usually covers the vehicle first, then the driver. So essentially, if you were driving your friend's car (and not a rental), his policy would cover it, and then yours would kick in for anything over his limit. In this case, the rental car could be considered "his" for insurance liability purposes, which is why I suggested that your friend's policy may need to be the primary on this.

I'm an adjuster for a major/national auto insurance company, and this is how we handle things. Your contract itself (or your friend's contract) may differ, so of course your results may vary.
posted by mewithoutyou at 4:08 PM on January 17, 2006

Response by poster: Mewithoutyou-
I don't know if you will see this but it was resolved just as you said. Unfortunately I was getting different answers from different sources and only recently was put at ease. Should have listened to you.
It turns out that if there are no policies covering the drivers, the liability carried by the car company will cover the claim.
posted by Corpus Callosum at 12:02 AM on January 26, 2006

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