Whether you book rentals primarily online, rent vehicles at a counter, or focus on luxury rentals or tourism, the proper insurance package can provide the financial backstop you need to focus on growing your car rental business. Let’s review some of the most important insurance coverages rental car companies require.
Commercial general liability insurance is a baseline coverage
Even if you book rentals entirely online, you still will have customers at your lots and counters. Commercial general liability (CGL) insurance provides liability coverage should a visitor become injured on your premises. Your CGL coverage helps with the costs of investigation, legal defense, and settlement of liability claims, whether you’re found negligent or not.
Personal injury and advertising coverage is another key portion of the recommended CGL coverage. Your policy will help with costs related to allegations your marketing efforts infringed on a copyright or wrongly used an advertising slogan or trade dress in your ads.
Commercial property insurance
Weather, fire, and other events can destroy your buildings and their contents. Whether you own or lease your offices, you need commercial property insurance. It can cover building contents as well as structures such as office space, signage, gates and booths.
You may operate in areas prone to floods or earthquakes. Your JAISIN advisor can help with coverage for these risks as an “endorsement” (an addition) to your property policy or through stand-alone flood or earthquake insurance.
An important part of your commercial property insurance is protection for reduced business income after a covered loss. Business income insurance helps replace lost income and provides funds to buy materials and supplies needed to get you back in business after a covered disaster. Business income insurance for rental car companies can also help pay for an alternative location or even a mobile unit set up on your premises so you can keep your customers rolling.
Fleet insurance helps keep your vehicles on the road
Rental car commercial auto liability and physical damage coverages are crucial to keeping you protected and getting your rental vehicles back in service after an incident.
Your fleet insurance should be crafted by someone versed in this field since you need protection for vehicles in your lot, vehicles in transit to or from your lot under your custody, and vehicles in use by customers.
Business income, or business interruption, coverage is an important consideration you should discuss with your JAISIN advisor since a large incident, such as a storm or fire, could disable or destroy your fleet and end your revenue stream.
You also need financial protection for crashes or other damage caused by your employees and customers, as well as damage caused by storms, vandalism, and other non-collision events. Theft, glass-only claims, and parts-only theft should be covered.
Moreover, you need liability insurance that travels with the vehicle in case a defect or maintenance error leads to an injurious accident. Carrying uninsured and underinsured motorist protection will be important in case your company is sued because the driver of one of your cars didn’t have enough insurance.
You’ll probably want to offer your customers products such as supplemental liability insurance, collision damage waiver, personal accident insurance and even personal effects coverage. All of these need to be included in your overall insurance portfolio, so discuss each aspect carefully with your advisor at JAISIN.
Workers’ compensation insurance
Auto-related injuries are probably the most frequent injury to rental car employees. But customers, too, can injure an employee. Because most states require you to provide workers’ compensation coverage after you reach a certain number of employees, you’ll probably need this coverage.
Workers’ compensation insurance covers wage replacement, medical treatment and, in some cases, vocational rehabilitation if an injured worker is unable to perform the duties of his or her former position. It also provides settlements for any disability associated with the work injury.
Cyber insurance
Cyber insurance is available as first-party coverage, which helps restore your systems after an attack, and third-party coverage, which helps pay for damages caused to others by a breach of their data stored on your networks.
Many of today’s rental booking transactions occur online. You also hold personal information to guarantee your rental return in good condition, and you no doubt manage your inventory by computer. The costs associated with ransomware, data breaches, and general denial-of-service attacks that shut down your networks run high. The right cyber insurance will step up to help you avoid financial disaster, assist victims, and handle crisis response.
Further considerations
When you hire or fire, you face employment liability risks. Businesses with employees should consider employment practices liability insurance (EPLI). This important insurance guards your company from financial loss when an employee makes a claim of harassment or other wrongful treatment.
If you’re offering health benefits or retirement plans, your staff members can make administrative errors that create financial problems and liability claims. Insurance to protect you from financial loss due to on-staff benefits administration problems is available.
Your JAISIN advisor may offer you an insurance program specifically designed for rental car companies and franchises. These programs bundle many of the coverages you need in this industry. Discuss the payout limits to see if they are high enough, and ask what policies you will need to buy as stand-alone products outside the offered program.
Your JAISIN insurance advisor understands the rental car business and its risks and can shed light on threats you might miss. Call or email us today about an insurance portfolio that grows as you grow.
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