When someone is involved in a car accident, oftentimes, their vehicle is damaged to the point that it must go into the auto shop, usually requiring extensive and costly repairs.
Sometimes these repairs can take weeks or months to complete. You still need to make it to work, drive your family to and from their activities, and get them to school.
Other times, the damage is so widespread that the automobile is a complete and total loss. This can also take several weeks before the insurance adjuster makes it out to look over the vehicle to determine if it is indeed totaled. Loss of use coverage would cover the time between the accident and the adjuster making their decision.
In both cases, there is a span of time where they will be without the use of their vehicle; this is when loss of use will benefit them.
What Is Loss of Use Coverage in an Auto Insurance Policy?
Loss of use coverage is rental reimbursement available to provide transportation for you when you have been involved in a car accident and are no longer able to use your vehicle. Whether you rent a car, take a bus, or taxi, while your vehicle is being fixed, loss of use coverage helps you continue on with your day-to-day responsibilities.
It is important to note that this coverage is not automatically added to auto policies; it is an add-on coverage that the policyholder must request. It is not typically an expensive add-on but is worth every penny if you depend on your vehicle for everyday driving and commuting, you cannot go without a vehicle for any amount of time, or just do not want to lose the luxury of having access to a vehicle.
What to do After a Car Accident for Loss of Use Coverage
If you have been in a car accident and carry loss of use coverage, you need to take the following steps:
- Contact your insurance company as soon as possible and let them know you will be filing a claim for loss of use.
- Review your policy documents with your insurance agent so you know how much you can claim each day based on your daily limit of liability chosen for your policy.
- Get pictures of all damage done to your vehicle and auto shop quotes for repair. This will inform you how long it will take for the repairs to be completed.
- Get all details and proof in writing so that the processing of your claim goes quickly and smoothly.
Having Loss of Use coverage is great, but not if the coverage is lower than you need. If you typically drive an 8-passenger SUV or van, but when the time comes to use your coverage, you find out that coverage limits will only cover a small two-door coupe, your family may be put in a tough spot for transportation.
Coverage Limits
In most cases, the insurance company sets their coverage limits for the amount they will pay for substitute transportation. They do this by putting a cap on how many days you can use the coverage or by providing a set dollar amount for the rental, such as $55 per day.
Your insurance company will not pick the vehicle for you, but they do expect you to rent a comparable vehicle to the one you already drive and insure. It is possible for the insurance company to deny a loss of use claim if they see you opt for a luxury sports car for your rental vehicle when the vehicle you own is a Corolla that is getting fixed.
When Can I Collect Loss of Use?
Under certain circumstances and if the coverages are available, you can collect compensation for loss of use if you have been involved in a car accident.
At-Fault
If the collision was your fault, you must notify your insurance company of the crash. If the appropriate coverage is available, they will give you compensation for loss of use.
Not at-fault
If the collision was not your fault, the at-fault driver’s insurance company is responsible for compensating you for loss of use after the crash. If the other driver did not carry loss of use coverage, you will then need to go through your own insurance company.
Should I Hire An Attorney?
The Indianapolis car accident lawyers at Wagner Reese are experienced in handling these types of claims and can help you navigate the complex insurance company jargon. Reach out to us today for a free consultation to discuss your car accident claim using our online form.
