Commercial Auto Insurance and Rental Vehicles

Renting vehicles can often be an integral part of running a business, whether it’s for transporting goods, driving clients or sending employees on business trips. However, navigating the complexities of insurance coverage for these rental vehicles can be challenging.

Properly insuring rental vehicles can help protect your company’s financial assets and secure your operations against unexpected disruptions. Accidents, thefts and other liabilities can result in substantial financial losses and potentially severe repercussions for the business.

Commercial Auto Insurance—Does It Cover Rental Vehicles?

Many commercial auto insurance policies include liability coverage, which may extend to rental vehicles. This is essential for protecting your business from third-party damage claims if your employee is responsible for an accident while driving a rented vehicle.

If your commercial policy includes comprehensive and collision coverage, it might also cover physical damage to rental vehicles. However, this is not universally guaranteed, and specifics can vary between policies, so it’s crucial to confirm with your insurance provider.

Optional Auto Insurance from Rental Companies

Rental companies typically offer various insurance products at the time of rental, such as loss damage waivers and collision damage waivers. These waivers aren’t insurance per se but may help protect against physical damage or theft of the vehicle.

Hired and Non-Owned Auto Insurance

Hired and non-owned auto insurance can help cover your company’s liability for potential third-party accident-related claims and legal expenses if your company is sued for accident-related negligence. This coverage may extend to rented, borrowed or leased vehicles your employees drive during business. It may also help provide liability coverage if your employees use their personal vehicles to conduct business.

When Commercial Coverage Might Not Be Enough

While your existing commercial auto insurance might offer some level of coverage for rental vehicles, there are situations where it may not be sufficient:

• Contractual obligations—Some rental agencies have specific insurance requirements stated in their rental agreements that your existing policy may not cover.
• International rentals—If your business rents vehicles outside your policy’s geographical coverage area, like in another country, your commercial insurance likely won’t cover these rentals.
• Special vehicle types—Standard commercial policies may not cover certain types of rental vehicles, such as heavy-duty trucks or equipment that exceeds the typical scope of your policy’s definition of a covered auto.

How to Get Insurance For Rented Vehicles

Consult the Byfield Agency in Parkland, Florida and tailor commercial auto insurance for rented vehicles to suit your company’s needs.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.