What are my rights if my auto insurer is trying to deny a claimfor damage to a rental car?

UPDATED: Jan 3, 2011

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What are my rights if my auto insurer is trying to deny a claimfor damage to a rental car?

I recently rented a car for personal use and was struck by a falling rock off the hillside. My personal insurance company is trying to deny my claim. They say the coverage falls under comprehensive which is not covered for personal rentals (they said only collision is covered). They also said that if the rental car was rented because my car was in the repair shop and I needed the car, it would have been covered. None of this information is in my policy conditions booklet. The paragraph they referred me to was: “Coverage D (comprehensive) will apply to a non-owned automobile when rented to the named insured, as a driver, from a public rental agency or furnished by a licensed vehicle repair facility which is repairing an owned automobile”.

Asked on January 3, 2011 under Insurance Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

Your right is to have your policy paid as per the terms and conditions of the insurance policy--no more and no less. If your insurer is refusing to pay a claim that they should, you could, if necessary, bring a legal action to try to force them to do so. From the quoted language, it appears that there is a disagreement about interpretation--it seems the insurer is reading the term to mean that the rental must also be pursuant to repairs. That is not the only possible interpretation, of course, of that language, and generally speaking, ambiguities in language which reduce or exclude coverage are usually interpreted liberally in favor of the insured (i.e. the benefit of the doubt, on reasonable interpretations, is given to the insured). You therefore would seem to have quite plausible grounds to contest the denial, though based  on how much money is at stake, it  may or may not be worthwhile taking legal action.

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