Domestic Car Rental Insurance

Rental Vehicles:

This discussion applies to vehicles rented for use on UMB business. When renting vehicles for University business, SIGN THE CONTRACT WITH THE DRIVER'S NAME AND A UNIVERSITY OF MARYLAND, BALTIMORE/STATE OF MARYLAND. It is critical to do this to secure liability protection under the Maryland Tort Claims Act, as discussed below. Employees who rent vehicles for UMB business should find out whether their personal automobile liability policy will apply to cover property damage to the rented vehicle or liability claims arising from use of the rented vehicle. It is recommended that personal coverage for rented vehicle use be maintained by employees who rent vehicles for UMB business, due to the risk that a claim might be found to relate to personal use rather than UMB business, and therefore determined not to fall under the Maryland Tort Claims Act.

  1. Physical Damage Coverage:
    • Rental companies usually require the renter (i.e., the UMB employee) to be responsible for most accidental damage to the rented vehicle. This provision is included in the rental contract. An employee renting a vehicle should know whether or not his/her personal automobile liability insurance will cover accidental damage. If it does, any claims should be reported to the personal automobile liability carrier as well as UMB.

      Rental companies will attempt to sell drivers supplemental rental insurance. UMB will not reimburse the cost of purchasing such insurance. The State's self-insurance will apply to property damage to a rented vehicle, subject to a $1,000 deductible charged to UMB. However, due to the risk of the State denying a claim if the vehicle was used for a personal purpose at the time of the damage, employees are strongly encouraged to assure that their personal automobile coverage applies or to purchase the rental company's insurance and bear the cost. Employees may be reimbursed for vehicle rental collision damage waiver insurance for foreign rentals (outside the 50 states).

  2. Liability Coverage:
    • Most rental companies automatically provide minimum limits of coverage, with the most common limits being $15,000 per person for bodily injury, $50,000 per bodily injury, aggregate of all claims, and $25,000 for property damage. Higher limits may be purchased by the employee at his/her expense. UMB will not reimburse for liability insurance purchases under most circumstances. The Maryland Tort Claims Act applies to claims related to use of a rental vehicle for UMB purposes in Maryland, or claims brought in Maryland related to use of a University vehicle out of state. For liability protection in out-of-state accidents, a UMB driver must rely upon insurance purchased from the rental company or personal automobile insurance. The University recommends that drivers NOT rely upon the rental company's minimum liability coverage when using a rented vehicle out of state on UMB business. Personal insurance should be relied upon or the driver should purchase higher limits from the rental company. The expense of personal insurance or separately purchased insurance will not be reimbursed in most cases. Employees who can document to UMB that they (1) do not own a car and (2) do not have automobile insurance, may be reimbursed for purchasing liability insurance for vehicles rented for use outside the State of Maryland.