Does State Farm Cover Rental Cars While Yours Is Being Repaired

State Farm's rental car coverage depends on which policy you choose

State Farm does not automatically cover rental cars under a standard auto insurance policy. You have to add rental reimbursement coverage as an optional add-on, and you decide the daily limit when you buy it. If you do not add this coverage, State Farm will not pay for a rental car if yours is damaged in a covered accident or stolen.

The coverage works by reimbursing you for the actual cost of renting a car, up to the daily limit you selected. If you chose a $30 daily limit and rent a car for $45 a day, State Farm pays $30 and you pay $15. The reimbursement continues for as long as your car is being repaired or until the maximum number of days runs out, whichever comes first.

Key Takeaways

• Rental reimbursement coverage is optional and must be added to your State Farm policy; it does not come standard.
• You choose a daily limit (typically $15 to $75 per day) when you add the coverage, and State Farm reimburses up to that amount.
• The coverage applies only when your car is being repaired after a covered loss, not for personal travel or other reasons.
• State Farm also offers transportation expense coverage, which reimburses you for taxis, rideshare, or public transit instead of a rental car.

How rental reimbursement coverage works after an accident

When your car is damaged in an accident or other covered event, you file a claim with State Farm. Once the claim is approved and your car goes into the repair shop, you can rent a replacement vehicle. Keep your rental agreement and receipts.

State Farm will reimburse you for the rental cost up to your chosen daily limit. If your policy has a $40 daily limit and you rent a mid-size sedan for $50 a day for five days, State Farm reimburses you $200 (5 days × $40). You pay the remaining $50 out of pocket. The coverage typically lasts until your car is ready to pick up, though some policies have a maximum number of days (often 14 to 30 days).

You do not have to use a specific rental company. State Farm will reimburse you for any rental car, though some policyholders find that using a rental company in State Farm's network makes the process smoother because the company may bill State Farm directly.

What the daily limit means and how to choose one

The daily limit is the maximum amount State Farm will pay per day for your rental. Common daily limits are $15, $20, $30, $40, $50, and $75, though the exact options depend on your state and your agent. A higher daily limit costs more per month but covers more expensive rentals.

To pick the right limit, think about what kind of car you would rent. If you drive a compact sedan and would rent a similar car, a $30 daily limit might be enough. If you drive an SUV or luxury vehicle and would want a comparable rental, you might need $50 or $75 per day. Check current rental rates in your area to get a sense of what you would actually pay.

You can change your daily limit when you renew your policy or at any time by contacting your State Farm agent. If you realize your limit is too low after an accident, you cannot increase it retroactively for that claim.

Transportation expense coverage as an alternative

Instead of (or in addition to) rental reimbursement coverage, you can add transportation expense coverage. This covers the cost of taxis, rideshare services like Uber or Lyft, public transit, or rental cars while your vehicle is being repaired. Some people prefer this option because it gives them flexibility — they can use whatever transportation makes sense on a given day rather than committing to a rental car for the entire repair period.

Transportation expense coverage typically has a daily limit and a maximum total payout per claim, similar to rental reimbursement. The daily limits are often lower (sometimes $15 to $30) because taxis and rideshare are usually cheaper than car rentals. Ask your State Farm agent which option makes more sense for your situation.

What rental coverage does not include

Rental reimbursement coverage applies only when your car is being repaired after a covered loss. It does not cover rentals for personal travel, vacation, or any other reason. It also does not explore if your car is stolen but not yet recovered — the coverage begins once you file a claim and your car enters the repair process.

The coverage also does not pay for damage to the rental car itself. If you rent a car and get into an accident with it, you are responsible for that damage (unless you bought the rental company's damage waiver). State Farm's rental reimbursement coverage only covers the cost of renting the car, not liability or collision on the rental vehicle.

How to add rental reimbursement to your State Farm policy

Contact your State Farm agent by phone, through the State Farm website, or through the mobile app. Tell them you want to add rental reimbursement coverage and ask what daily limits are available in your state. Your agent will explain the monthly cost for each limit option.

Once you choose a daily limit, the coverage takes effect on the date you select. You can add it when ready or wait until your next renewal, though adding it before you need it means you are covered if an accident happens. If you already have a policy, adding rental reimbursement usually takes just a few minutes and may cost $5 to $15 per month depending on the daily limit you choose.

What to do if you need a rental car after an accident

File your claim with State Farm as soon as possible after the accident. Provide photos of the damage, the police report number (if applicable), and the contact information for any other drivers involved. State Farm will assign an adjuster to inspect your car and estimate the repair cost.

Once your claim is approved, take your car to a repair shop. You can use any shop you trust, though State Farm has a network of preferred shops that may offer faster service. When you are ready to rent a car, choose a rental company and keep your rental agreement and daily receipts. Submit these documents to State Farm along with your claim number, and they will process your reimbursement.

Some State Farm agents can help coordinate the rental directly with a partner rental company, which may streamline the process. Ask your adjuster or agent whether this option is available for your claim.

Frequently Asked Questions

What if my repair takes longer than my daily limit allows?

If your policy has a maximum number of days (for example, 14 days), and your repair takes longer, you pay out of pocket for the extra days. Some policies have no day limit, only a total dollar limit. Check your policy documents or call your agent to understand your specific limits.

Do I have to use a rental car, or can I use rideshare instead?

If you have rental reimbursement coverage, you can use a rental car. If you have transportation expense coverage instead, you can use taxis, rideshare, or public transit. Some people add both coverages for maximum flexibility. Ask your agent which option you have.

Will rental coverage pay if my car breaks down, not from an accident?

No. Rental reimbursement coverage applies only to damage from a covered loss — accidents, theft, vandalism, weather, and similar events. Mechanical breakdown is not covered. If you want coverage for breakdowns, you would need a separate roadside information or mechanical breakdown policy.

Can I add rental coverage after an accident happens?

No. You must add rental reimbursement coverage before the accident occurs. Coverage takes effect on the date you add it, so if you add it after an accident, it will not cover that claim. Add it to your policy now if you think you might need it.

How much does rental reimbursement coverage cost?

The cost varies by state, your driving record, and the daily limit you choose. A $30 daily limit typically costs $5 to $10 per month, while a $50 daily limit might cost $8 to $15 per month. Contact your State Farm agent for a quote based on your specific situation.