If your car were totaled in an accident, how would you get to work the next day? Loss-of-use car insurance may provide an answer.

Loss-of-use insurance is an optional coverage on many car insurance policies that covers the cost of a rental vehicle for policyholders who have incurred a loss that leaves their car temporarily inoperable.

"Anyone who doesn't have multiple cars available to drive should purchase loss-of-use insurance because it is much less expensive than renting a car," says Carole Walker, executive director of the Rocky Mountain Insurance Information Association.

Walker says the cost of loss-of-use car insurance varies depending on the insurance company and the options chosen. However, the extra coverage generally costs less than $50 per year.

Kip Diggs, a spokesperson for State Farm Insurance, says the insurer's average annual premium for loss-of-use coverage is about $28.

"Anyone who can't afford the cost of renting a vehicle while theirs is unavailable to them or doesn't have a spare car to drive should buy loss-of-use coverage," Diggs says. "Renting a car for days or weeks can be expensive."

There are many different types of loss-of-use coverage, but most policies "allow a certain amount of coverage per day and a maximum [overall] limit on the cost of a rental car," says Walker.

Diggs says State Farm generally has no dollar or time limits and pays for a rental car during the entire time the damaged car is being repaired.

Rental fees will also be reimbursed if the car can't be repaired and you need to rent a car while shopping for a new one. But there usually is a limit on how long rental fees will be covered, Diggs says.

Some consumers may be tempted to upgrade their rental car since the insurance company is paying for it. But because many insurance companies cap the overall amount of money they will pay out, it's better to exercise restraint, Walker says.

"It's just transportation while your car is being repaired, so if your policy is limited to a certain level per day or overall, it makes more sense to get the least expensive rental car to make sure you don't have any additional out-of-pocket expenses," says Walker.

Walker says drivers have the option of choosing their own rental car company, but she suggests asking the insurance company for a recommendation.

"Most insurance companies have relationships with rental agencies and may be able to get lower rates for their customers," says Walker.

If the other driver was at fault in the accident, payment for the rental car is generally paid for by the other driver's insurance company rather than your own loss-of-use car insurance.

"If you are at fault, the coverage will be paid under your loss-of-use endorsement," Walker says. "If someone else is at fault, the rental car coverage comes from their liability insurance. This way, drivers are covered even if the other driver does not have loss-of-use coverage."

Walker says drivers should always contact their own insurance company before attempting to  contact the other driver's insurance company.

"You can have the other person's insurance company pay for your rental vehicle, depending on whether the other driver's insurance company is accepting fault for the wreck," says Diggs. "If fault is being disputed, you can use your rental coverage while the final determination is being made."

Loss-of-use car insurance coverage also does not apply if your car is stolen.

Walker says insurance companies pay for a rental car for drivers who have had a car stolen while the case is under investigation. This coverage comes under the comprehensive auto insurance coverage.

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Understanding Your Car Insurance Options at the Rental Counter

On vacation, on a business trip or even moving your freshman to college – deciding whether to buy rental car insurance is complicated. As the rental car agent hovers over the contract with a pen, you have to make the decision in a split second!

So, how do you know if the car insurance rates you pay on your current policy will cover your rental car? Although this step-by-step guide can help you avoid a costly mistake, your insurance company may have special rules, so be sure to ask about the coverage available on your own policy. From determining if auto insurance companies will provide coverage for your rental to insurance for traveling abroad, use these five simple steps to avoid a costly mistake:

Most auto insurance companies will extend the coverage on your personal auto policy to a rental car. The important fact is whether you have bought Comprehensive and Collision coverage on your own car. That's the coverage that pays for damages like scratches, dents and thefts. If you have this coverage on your own policy, it will transfer to a rental. Call your auto insurance company to check – but before you do, keep reading.

Many credit cards will pay for damage to a rental car when you pay with that card, but the coverage will be secondary to your own policy if you have one. Your card also may pay for towing – but will never pay for damage or injury that you cause to another car or driver. That's covered by liability or personal injury protection – which is why having your own policy is so important.

Many employers have corporate coverage for employees who rent cars, so don't buy the extra coverage unless you've checked with your boss or the fleet department first. When you travel for pleasure, your rental car is considered a temporary substitute for the car you've left at home – and that's why the policy you have with your own auto insurance company may provide coverage.

In the United States, insurance laws are different in every state. Policies in some states like Massachusetts may only cover travel within the state. But, in most states, you're covered as long as you drive in the U.S. However, many policies may limit coverage if you travel to Canada and few will cover travel to Mexico. If you're traveling abroad, most travel guides recommend buying the coverage with the rental car, because it's too complicated to deal with insurance in another country.

Or your best friend, boyfriend or teenage daughter. Rental car companies are picky about who drives their car and any coverage you have on your policy from your own auto insurance company (or the rental car policy) may not cover another driver – unless they are listed on the rental contract.

Get an auto insurance quote online now at insurance.com to find some of the best car insurance rates and discounts available, or call one of our friendly licensed agents toll-free.

Looking for different information? Have questions or comments? Please let us know.

Originally posted September 17, 2004.

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File a claim with your insurance, and, if they believe there is liability with the shop, they will take the appropriate action.

Mine would not, that is what deposits and law suits are about.

1 your age is not a problem the charge depends on the vehicle and how far you drive. count on $45 per day inclusive
2 your licence will be accepted
3 budget rent a car
4 insurance is manditory, (about 12 to 20 dollars per day) but you can arrange rental insurance through your current policy holder sometimes, so check that out.
5 welcome to canada. enjoy your trip.

http://www.bc.budget.com/

Have you compared Geico's coverage and price to the rental car company's coverage and price ? I would let that be the determing factor

i passed my test 2 years ago and everyone said my insurance would be through the roof, i went online and got a quote from "quinndirect" i was just under 500 a year for a 2004 fiesta, a guy in a white van reversed into it while it was parked outside my house and within 2days it had been collected and a brand new courtesy car delivered. it will be slightly higher because of your age but give them a try.

hope this helps.

However, there are many agents who can help you to get comparatively cheaper car insurance policies even if you fall in the high risk bracket. Being one among the high risk drivers seeking cheap car insurance, you can get one by paying higher deductibles. Thus by paying higher deductibles if there is a collision, you can pay a lower premium.

But being a young driver with a cheap motor insurance policy, you will not be covered if you are driving a rental car. Thus any accident involving a rental car will not be covered by the cheap insurance cover. As a young driver another way you can avail a cheap insurance policy for your car is to get a limited insurance. Getting a limited insurance coverage for your car means that there will be no windshield cover and also there will be very limited anti theft coverage. So if you are getting your insurance through a company which generally does not offer young drivers car insurance, than chances are that you may end up paying a higher price than what is necessary.

In order to ensure that you get the best quote, go online and compare the rates of various motor insurance companies which offer insurance cover for young drivers. By doing a careful research and comparing the insurance rates offered by various companies you can save on thousand of dollars. If you do careful research you can actually find several motor insurance companies which specialize in offering the best deals to the young car drivers and the high risk drivers. Most of these companies are well recognized in the insurance field. They are especially well known for offering great insurance rates for young drivers and are reliable firms. Thus it is wise to deal with these specialized companies as they have carved out a way to make insurance cheap for young drivers who are looking for cheap motor insurance. So go online and do a thorough research before you zero in on any particular company.

For any help on Car insurance policies, check out the info available online; these will help you learn to find the car insurance rates comparison

However, such a scenario need no longer be the case as with the evolution of internet banking into everyday life, managing one's finances is made much simpler and quicker. Although still a relatively new concept, it has nonetheless become a welcome facility for those who are unable to attend their bank in person for whatever reason.

There are many advantages to banking via the internet, with the most attractive point being convenience. The fact that users can perform banking duties at anytime 24/7 and anyplace where an internet connection can be made makes it an attractive proposition for many. What's more, with the most common functions associated with their high-street counterparts, such as arranging a loan or paying a bill, being readily available online, internet banking could spell an end to lunchtime queuing altogether.

Another important advantage of performing banking online is that it can speed up any transactions across the range of services the facility has to offer. These services include checking statements online; viewing recent transactions made; setting up and managing standing orders and direct debits, and also being able to transfer funds between specific accounts with ease, in order to pay bills or top up savings from excess cash. Rather than perhaps taking several days to complete, all of these functions can be performed in a matter of minutes with just a few clicks of a computer mouse.

In some cases, depending on the service provider, even more specialised tasks can also be performed, such as arranging car or home insurance or ordering foreign currency.

Internet banking customers needn't be stuck either, should they encounter any problems when it comes to managing their account. Many providers of internet banking facilities also offer their customers a dedicated help-line which operates in tandem with their online service, to guide users through and answer any questions or concerns users may have regarding the online banking process.

There are still some things that can't be done using online banking, however; such as changing or paying in bags of accumulated loose change, or the paying in of a cheque but overall, internet banking has more advantages than disadvantages when it comes to managing finances - not least of all the fact that internet banking comes without queues or opening and closing times, so managing one's financial matters needn't cost a lunchtime!

Paul McIndoe writes for a digital marketing agency. This article has been commissioned by a client of said agency. This article is not designed to promote, but should be considered professional content.