Car rental: does my car insurance cover me in the event of an accident?

Have you ever rented a car while traveling in Canada or the United States? If so, you know that short-term car rental companies offer additional coverage that protects you in the event of damage or an accident involving the rented vehicle. But is that enough? Can your personal auto insurance cover the damages in the event of an accident?

That’s the question that Assurances Multi-Risques invites you to answer today!

Car rental insurance: who will pay for damage caused in the event of an accident?

First, you should know that the “protection” offered by car rental companies is not car insurance. These protections also have their own limitations. Always check the terms and conditions of this additional protection in detail, including the maximum amounts covered and other limitations, etc. Otherwise, you may be forced to pay the difference out of your own pocket!

Please also note that you are not obligated to purchase this coverage; in other words, you can choose not to pay this additional fee on top of your rental cost. However, in this case, you would be responsible for paying 100% of the cost of any damage or replacement of the vehicle (in the event of a serious accident).

UNLESS you have subscribed to coverage FAQ 27: “Civil liability for damage caused to vehicles that are not owned by the named insured” in your personal auto insurance policy.

To be insured against damage to borrowed or rented vehicles in the event of an accident for which you are responsible, you must add additional coverage to your auto insurance policy. This coverage is FAQ 27, also known as “endorsement 27“!

This protection will be useful in the following situations:

• If you rent a car while on vacation, this endorsement covers the rental vehicle. This means you won’t have to pay the rental company’s deductible waiver!
• If you borrow a vehicle from a relative or friend.
• If you are provided with a courtesy car while your vehicle is in the garage.

In the event of a no-fault accident, the vehicle owner’s insurance would cover the damages!

Advantageous protection

Please note that this coverage is identical in every way to the coverage you have for your own vehicle. It therefore includes the same options and deductibles! Endorsement 27 is also much more affordable than the coverage offered by car rental companies, but more importantly, it protects you much better!

Indeed, endorsement 27 covers you in the event of an accident, regardless of the insurance policies of the company or individual who owns the vehicle you have rented or borrowed!

Good to know!

If you have FAQ 27 coverage in your auto insurance policy, you are not required to use it in the event of an at-fault accident while driving a borrowed car. You may decide to pay for the repairs yourself (if they are minor).

Your insurance record would therefore remain accident-free and your premium would not increase! It is sometimes necessary to do the math, because it could end up costing you more to make an insurance claim.

If you are unsure about the best decision to make in your situation, we recommend that you contact your insurance broker first. They will be able to help you weigh up the pros and cons!

In addition, it is important to note that endorsement F.A.Q. 27, which applies to your auto insurance, cannot be used for a motorcycle, for example! So if you borrow your uncle’s beautiful Harley, be careful!