Careful buying Rental Reimbursement Coverage by Farmers


Lets assume you are driving on or about June 14, 2017 and an uninsured vehicle causes a collision.   The impact is major and your vehicle destroyed.   You are not at fault for this collision.   The at-fault driver failed to yield the right away and caused the collision.   Your vehicle is being towed to your home.    So now, you have lost your only transportation, your car.    Getting around has become impossible.  Uber and/or taxi will increase your transportation budget exponentially if you use them daily.  You can rent a car, but knowing that the at-fault party has no insurance, the bill will have to be covered by you.

Luckily, for years, you have been paying for full coverage and  Rental Reimbursement Coverage with Farmers.    The full coverage will pay to repair or replace your vehicle.    And as far as the rental coverage, the Farmers agent told that if your car became withdrawn from normal use due to a collision,  you would have $50 per day up to $1500 (or 30 days) of rental coverage.  That is great.   Now, you can move around: you have a rental to go into work; you have a rental to go find a new vehicle (because your car is totaled); and/or you have the ability to drive to the doctor’s office to attend to your injuries.    That is great: NOT REALLY !!!

WHAT the Farmers agent did not tell you is this:

Although you have rental for up to 30 days, the rental coverage does not begin until your left without a vehicle for 24 hours.   So you have to wait 24 hours.  After that, the rental ends IMMEDIATELY if Farmers looks at your vehicle (which in this case they did on or about June 16) and declares it a total loss and “offers” to cover the damage as a total loss.   In other words, the agent goes to your home, declares the vehicle a total loss, and then ENDS your rental.    Thus, Farmers will immediately send an agent to look at the vehicle when they know the damage may be extensive.    Moreover, now you are left with no rental.  THIS OCCURS BEFORE YOU EVEN RECEIVE A PENNY TO REPLACE YOUR TOTALED VEHICLE.   Farmers’ rental policy reads that the rental terminates “when we offer settlement on a total loss,” not when we “pay” for the total loss on the vehicle.    So, now an adjuster made an offer and terminated the rental.  You still do not have any funds, because that can take weeks.   The vehicle’s title needs to be signed and sent to Farmers, and Farmers needs to request payment for the totaled vehicle.   So, for weeks you again are left without a car (because its totaled) or a rental even though you have “Rental Reimbursement Coverage.”

So, be careful.   Double check your policy.   See if there is better coverage to protect you from this scenario.

This incident is based on a true story.   Do not let it happen to you.