Getting into an accident is stressful under any circumstances, but it becomes even more complicated when the car involved isn’t your own. If you’re driving a rental car and get into an accident, several steps and responsibilities come into play.
Many drivers are unsure what happens next — who pays for damages, whether insurance covers the costs, and how the rental company handles the situation. This guide explains everything that happens if you get into an accident with a rental car, step by step, in clear, simple terms.
Immediate Steps to Take After the Accident
The first thing to do after an accident involving a rental car is to remain calm and follow the same basic procedures you would in any collision. Your safety and that of others come first.
1. Check for injuries. Before worrying about the car or insurance, ensure everyone involved is safe. If anyone is hurt, call emergency services immediately. Even minor injuries should be checked out by medical professionals.
2. Move to a safe location. If the car is drivable and it’s safe to do so, move it out of traffic. Turn on your hazard lights to alert other drivers. Never leave the scene of an accident.
3. Call the police. Whether the accident is minor or serious, you should report it to local law enforcement. A police report serves as official documentation, which is important when dealing with the rental company or insurance claims later.
4. Exchange information. Get the names, contact details, license plate numbers, and insurance information of everyone involved. If there are witnesses, collect their names and phone numbers as well.
5. Document the scene. Use your phone to take photos and videos of the damage, road conditions, traffic signs, and any visible injuries. These records help establish what happened and protect you if disputes arise.
6. Notify the rental company. Once everyone is safe and the police have been contacted, inform the rental car company about the accident. Most major rental brands, such as Hertz, Enterprise, or Avis, have emergency numbers for accident reporting. They will provide specific instructions on what to do next.
Understanding the Rental Agreement
When you rent a car, you sign an agreement that outlines your responsibilities in case of an accident. This agreement usually states that you are liable for any damage to the vehicle while it’s in your possession — even if the accident wasn’t your fault. The way that responsibility is handled depends largely on the kind of insurance or coverage you have.
Many renters don’t read the fine print before driving off the lot, but those details are crucial. The rental contract typically requires that you report any accident immediately, cooperate with the investigation, and not attempt to repair or move the car without authorization from the company.
Rental Car Insurance and Coverage Options
Whether you’ll have to pay out of pocket after an accident depends on what kind of coverage you have. Here are the main sources of protection you might rely on:
1. Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW). This is optional coverage offered by the rental company at the counter. If you purchased it, you’re typically protected from financial liability for vehicle damage or theft — as long as the accident wasn’t caused by prohibited uses, such as reckless driving or off-road use. CDW doesn’t usually cover personal injuries or third-party property damage, but it can save you from paying for the rental car’s repairs.
2. Personal Auto Insurance. If you have your own car insurance policy, it may extend to rental cars, especially if you’re renting within your home country. Coverage generally matches your existing policy — so if you have collision and comprehensive coverage, they might protect the rental car too. However, you’ll still be responsible for your deductible, and making a claim might increase your future premiums.
3. Credit Card Coverage. Many major credit cards include rental car insurance when you use the card to pay for the rental. However, this coverage is usually secondary, meaning it kicks in after your primary insurance. It often covers damage to the rental car but not liability for injuries or damage to other vehicles. Always check your credit card’s policy before renting.
4. Travel Insurance. Some travel insurance policies include rental car protection. These can be especially useful for international rentals or long trips. The coverage limits vary, but it may help reduce costs after an accident.
What the Rental Company Does After the Accident
Once you’ve reported the accident, the rental company will start its internal process. This usually involves assessing the damage and determining who is responsible for paying for repairs.
Damage assessment: The company will inspect the vehicle, either on-site or once it’s returned. They’ll prepare a damage report, sometimes with photos, outlining repair costs, loss-of-use charges, and administrative fees.
Insurance coordination: If you provided your insurance details or have a CDW, the rental company may contact your insurer or credit card company directly. Otherwise, they’ll send you a bill for the damages.
Replacement vehicle: Depending on your situation and coverage, you may be provided a replacement car while the case is being processed. However, this isn’t guaranteed and may come with additional fees if your insurance doesn’t include it.
Who Pays for the Damage?
The financial responsibility depends entirely on your coverage. Here’s how it typically plays out in different scenarios:
Scenario 1: You purchased the rental company’s CDW/LDW.
In this case, you usually don’t have to pay for damages unless the terms were violated. The waiver covers repair or replacement costs. However, you may still be responsible for certain fees, like towing or administrative expenses, depending on the policy.
Scenario 2: You rely on your personal car insurance.
If your personal auto insurance covers rentals, your insurer will handle the claim. You’ll have to pay your deductible, and the claim may impact your premium later. Your insurance will then reimburse the rental company for the damage.
Scenario 3: You rely on credit card coverage.
Your credit card company may pay for the repairs after your personal insurance has settled its portion. You might need to submit paperwork, such as the rental agreement, police report, and receipts. Credit card companies are strict about deadlines for reporting accidents, so file the claim as soon as possible.
Scenario 4: You have no coverage.
If you declined all protection and don’t have personal or credit card coverage, you’re fully responsible for all damages, towing, and potential loss-of-use costs. This can be very expensive, as rental car companies often charge for every day the car is out of service.
Dealing with Liability for Other Damages
If the accident caused injuries or damage to other vehicles or property, liability coverage comes into play. This is usually handled through your personal auto insurance or a policy included in your rental agreement. Many rental companies provide minimal liability coverage by default — often just enough to meet state or country legal requirements. However, it might not be enough to cover all damages, especially in severe accidents.
You can usually buy Supplemental Liability Insurance (SLI) from the rental company for additional protection. This coverage raises your liability limits significantly, ensuring that you’re not personally responsible for large third-party claims.
Administrative and Hidden Fees
Even if your insurance covers the bulk of repair costs, rental companies often add extra charges. These may include:
- Administrative fees: Charged for processing the claim and handling paperwork.
- Loss-of-use charges: The company claims compensation for the days the car is unavailable for rental while being repaired.
- Diminished value: In some cases, they charge for the car’s reduced resale value after being in an accident.
Some insurers refuse to cover these fees, leaving you to pay them directly. Always check your coverage terms carefully to avoid surprises.
If the Accident Wasn’t Your Fault
If another driver caused the accident, their insurance should cover the damages. However, the process can still be lengthy. You’ll likely need to pay the rental company upfront for the repairs and then seek reimbursement from the at-fault driver’s insurer. Providing documentation — such as the police report, photos, and rental company invoices — helps speed up reimbursement.
When You’re Driving Abroad
Accidents in foreign countries can be even more complicated. Your domestic insurance may not cover rentals overseas, and legal procedures vary widely. If you’re renting abroad, it’s wise to purchase the rental company’s full coverage or a specialized international policy. In some countries, you’re legally required to purchase basic insurance before driving away.
Always contact the local authorities immediately after an accident abroad, and then inform both the rental company and your insurance provider. They’ll guide you through the local procedures.
What Not to Do After a Rental Car Accident
Some mistakes can make your situation worse or invalidate your coverage. Avoid these common errors:
- Failing to report the accident: Even if it’s minor, not notifying the rental company can violate your agreement and void insurance coverage.
- Leaving the scene: Doing so is illegal and could result in criminal charges.
- Trying to fix the car yourself: You must not attempt repairs without authorization from the rental company.
- Admitting fault: Never tell the other driver or police that it was your fault until the investigation is complete.
- Ignoring paperwork: Missing deadlines for filing reports or claims can lead to denied coverage.
How the Rental Company Handles Serious Accidents
If the accident results in a total loss of the vehicle or serious injuries, the process becomes more involved. The rental company will likely involve its legal and claims departments. They’ll work with your insurer or lawyer to determine fault and compensation.
In severe cases, law enforcement or insurance adjusters may need to inspect the vehicle. If you purchased extra coverage, the CDW/LDW may handle the replacement cost, but serious negligence — such as driving under the influence — would void all protection and make you fully liable.
How to Minimize the Financial Impact
To reduce financial stress after a rental car accident, preparation is key. Before you even pick up the car:
- Review your personal car insurance and credit card coverage.
- Decide whether you need the rental company’s insurance add-ons.
- Inspect the car before driving off and note any existing damage.
- Understand the emergency contact procedure in case of an accident.
If an accident occurs, act quickly and provide full documentation to all parties involved. The faster you report, the smoother the process tends to go.
Long-Term Consequences After a Rental Car Accident
Beyond the immediate costs, a rental car accident can have longer-term effects. If you used your personal insurance, your premiums might increase.
If your credit card was used for coverage, it could temporarily affect your available credit until the claim is settled. In rare cases, repeated incidents can lead rental companies to flag your account, making future rentals more difficult.
Final Thoughts
Getting into an accident with a rental car can feel overwhelming, but understanding how the process works makes it easier to handle.
The most important things are safety, prompt reporting, and good documentation. Insurance coverage — whether through your personal policy, credit card, or the rental company — is your best protection against huge bills.
Every situation is unique, but the core principles remain the same: act responsibly, follow procedures, and communicate clearly with all parties involved.
When you know what to expect, even a stressful situation like a rental car accident becomes manageable. Preparation and awareness are the best ways to protect yourself, your finances, and your peace of mind.
