PLANNING TO RENT A CAR
Your
Insurance
or PARTICIPATE IN UBER? with
Cathy Karas.
HOW WILL YOUR CAR
INSURANCE RESPOND?
Cathy J. Karas, President, Certified Insurance Counselor,
Karas insurance Agencies Inc., 321 So Riverside Ave,
Croton-on-Hudson, NY 10520 914-271-5188 ph, 914271-9390 fx, email [email protected].
A
t this time of year we find many of our customers questioning the coverage afforded on their personal
auto policies when they plan to rent a car while on vacation. In order to fully understand how and why there is
coverage, it is important to first look at the definitions in
the policy to see who, where and what types of vehicles
can be covered.
WHO - The “named insured” on the policy declarations
and spouse ( but only if resident of the same household),
and family member who must be related to you by blood,
marriage or adoption and a member of your household
which includes a foster child.
WHERE - U.S. its territories or possessions, which includes
Virgin Islands, Puerto Rico and Canada.
TYPES OF VEHICLES - private passenger, pick-up or van,
or trailer.
If you are renting a box or dump truck from a Home
Improvement Center , such as Home Depot, or a moving
truck from a rental center such as U-Haul, your auto policy
will most likely not respond and you must purchase both
the liability and physical damage (collision and comprehensive) coverages if they are available. Ask what the liability limits are and be sure to select the highest limits
offered. The liability limits that are least expensive might
be $25,000 bodily injury per person/$50,000 per accident
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April 2015
and $25,000 for property damage. These days, those limits
are not adequate when you consider law suit settlements
for even minor injuries and the values of vehicles on the
road , which you may be held responsible for causing
damage to.
New York has adopted a rental vehicle coverage endorsement which applies to rental vehicles. So long as you are
renting in the name of a “WHO” (named insured or resident spouse, relative or foster child) on your policy, in an
area that is in the “WHERE” section of your policy and it
is a “TYPE OF VEHICLE” shown above, this endorsement
applies. The endorsement states “The Rental Vehicle Coverage endorsement to this policy provides protection in
the event of damage to, or loss of, a rental vehicle, including loss of use, as described in this endorsement.” There is
usually no premium charge for this endorsement and it is
available on policies that provide no collision or comprehensive coverages to any vehicles on the policy. Since the
coverage is assumed under the property damage liability
section, rather than collision or comprehensive coverage
sections, there is no deductible and even pays the “loss of
use”, which would be the money the rental agency would
be out due to the car not being able to be rented for a period of time, which could be a huge expense, depending
on the extent of damage and length of time it would take
to repair the car.
rented as those details are not shared knowledge, but you can
see what can happen.
It is also important you declare all drivers to the rental agency, as the contract you are signing most likely excludes unlisted drivers.
UBER – this is new service you can participate in to offer to
drive people who need rides and collect a fee. Sounds like a
good way to earn extra cash? NO – your NY personal auto policy will not respond in this situation as this constitutes a taxi/
livery exposure, which is an excluded use. You are taking a big
risk here as if there was ever an accident with injuries or property damage, you could be sued and lose everything you own.
The assumptions are based on a standard New York State
auto policy. We at Karas Insurance Agencies Inc have been in
business selling auto, home, umbrella, boat, recreational vehicle and all types of commercial insurance for 42 years. We
have licensed brokers with the knowledge to tailor a policy to
your needs, provide comparisons of coverage and cost with
many different companies, answer your coverage questions
and help you with claims. You can reach us at 914-271-5188
or contact me by email at [email protected].
Disclaimer: This article is for informational purposes only. For
specifics on your own policy you should contact your
current insurance broker or company.
If your vacation is out of the country and you are renting
in an area not in the “WHERE” section of your policy such
as, Europe or Mexico, you have no coverage at all – liability, injury to yourself or passengers, or collision or comprehensive coverages. This is the case for the “standard” NY
auto policy, however there are some companies that we
represent that offer an enhanced version of the personal
auto policy that does extend coverage out of the “WHERE”
territory. Or perhaps your credit card company can provide some coverage. If you do need to purchase the coverage, again, ask what the maximum liability limits are you
can buy, the minimum is never enough. Take the example
of an accident involving the actor Matthew Broderick in
Ireland in 1987. Driving on the wrong side of the road, he
smashed head on into another car, killing the driver and
passenger. How much liability insurance is enough in this
case? I don’t know what he purchased when that car was
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boatingonthehudson.com
April 2015
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