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If you rent a car while traveling on company business and you purchase insurance from the rental car agency, the coverage could add hundreds of dollars to your bill for a weekly rental. Before you go on your trip, find out what kind of personal coverage you have and what kind of commercial coverage your employer has. If don't buy insurance from the rental car company and have to make a claim, it will likely be resolved by some combination of the two coverages. If you're a United States government employee, you have full coverage with the U.S. Government Car Rental Agreement.
Personal Auto Insurance
Most personal auto insurance policies extend to rental cars, but find out if your policy covers a rental before you get a rental for a business trip. The Esurance website recommends that if you'll be paying for the rental with a credit card, check with your credit card company to see what additional rental car coverage is provided. If you don't have personal car insurance, let your employer know to make sure you're fully covered.
Most large companies have a commercial auto insurance policy that covers you while you travel. However, in some cases your personal insurance company will have to pay the claim and then seek reimbursement from your employer's insurance company. Or, the commercial policy might only provide secondary coverage, meaning it only pays after your insurance company has paid your maximum limit. Ask your company if there are any special procedures you should follow and who you should call if you 're involved in an accident. Also, tell the insurance adjuster that you are traveling on business at the time of the reservation, and provide your company's name along with your own.
U. S. Government Employees
If you are in the military or you work for the U.S. government or U.S. Postal Service and you rent a car while on authorized government business in accordance with the U.S. Government Car Rental Agreement, the rental car company provides all insurance coverage. According to a column on the JZ Helps website, if you have an accident, the rental car company is responsible for damage to the rental car and to other cars or property you damage, regardless if there was negligence on your part. The rental car company is also responsible for covering injuries you cause yourself and other people.
Purchasing Rental Insurance
If you don't carry personal car insurance and your company does not provide it, you can purchase insurance when you rent the car. You can usually buy four kinds of coverage. Loss-damage waiver covers the rental car itself and fees such as towing. Liability insurance covers you if you're sued by another person. Personal accident insurance reimburses medical expenses after an accident. Finally, personal effects coverage pays for items you have in the rental car that are damaged or destroyed.
- Insure.com: Using Your Personal Car for Business
- Esurance: Rental Car Coverage Is Always Necessary - Debunking a Car Insurance Myth
- Scott Simmonds: Business Use of Employee's Autos - An Insurance Perspective
- JZ Helps: Personal Injury Caused by Government Employees Driving Rental Vehicles
- Nationwide: Ten Ways to Save on Your Next Car Rental
Steve McDonnell's experience running businesses and launching companies complements his technical expertise in information, technology and human resources. He earned a degree in computer science from Dartmouth College, served on the WorldatWork editorial board, blogged for the Spotfire Business Intelligence blog and has published books and book chapters for International Human Resource Information Management and Westlaw.