Auto Insurance Coverage for Rented Vehicles
The University Treasurer's Office responds to inquiries about the University's auto insurance programs for auto rentals for University business travel. Contact Matthew Wamback at (774) 455-7588, firstname.lastname@example.org if you have any questions.
This Insurance Policy is only applicable to University Employees and University sponsored groups. Non-employees are not covered under this policy.
A. Rental Vehicles
When University employees rent vehicles for University business, the vehicle should be rented in the name of the University. Additionally, they must include the "University of Massachusetts" next to their names on rental applications. This helps to ensure that the University's Hired and Non-owned Excess Liability policy, which is described below, will provide excess liability coverage, if warranted.
Employees renting vehicles will most likely be given the option of buying the following two types of rental insurance:
- Liability Insurance-covers bodily injury or property damage to a third party
- Physical Damage Insurance-often referred to as a Collision Damage Waiver (CDW) or a Loss Damage Waiver (LDW)- covers property damage to vehicles
The University has a Hired and Non-owned Liability Insurance policy for vehicles rented for University business. The University's policy is only an excess policy. This policy has a $1,000,000 combined single limit for bodily injury and/or property damage to others.
If a Certificate of Insurance is requested by the rental car agency to verify liability coverage, a copy can be requested from the University Treasurer's Office.
When renting cars for University business, employees should:
1. Liability Insurance
a. Within Massachusetts
Decline the Liability Insurance offered by the rental company, if you are renting the vehicle in Massachusetts and you will only be driving the vehicle in the State of Massachusetts. In Massachusetts, rental companies are required by state law to carry the minimum liability coverage on their rental vehicles (the rental company's liability insurance serves as the primary liability insurance), so purchasing the additional Liability Insurance from the rental company is not necessary due to the University's existing excess policy.
b. Outside of Massachusetts
Purchase the Liability Insurance offered by the rental company, if renting a vehicle outside of the State of Massachusetts or for use outside of Massachusetts.
2. Physical Damage
a. Paying with University issued business credit card
Decline the Physical Damage Insurance offered by the rental company, if the employee is using a University issued business credit card to rent the vehicle and that credit card provides primary coverage for physical damage. Please note that it is important for the employee to carefully review the terms of their University credit card to make sure that it does provide primary Physical Damage Insurance when renting a vehicle. The employee will also want to make sure that the type of vehicle he/she is renting is not excluded from the coverage provided by the credit card.
b. Paying with a purchase order or personal credit card
Purchase the Physical Damage Insurance (CDW/LDW) offered by the rental company if paying with a purchase order, personal credit card, or any other means of payment that does not provide primary Physical Damage Insurance coverage. Also, purchase the physical damage insurance if renting a van that carries more than eight
If in doubt as to whether or not the employee's University issued business credit card provides primary physical damage coverage, it is a good idea to purchase the coverage from the rental company. The Physical Damage Insurance coverage offered by the rental company is a good protection at usually a low daily rate. Please contact the University Treasurer's Office if you have any questions regarding a rental or credit card contract.
B. In the event of an accident?
Regardless of the type of vehicle, the University Treasurer's Office must be contacted if an employee is involved in an accident while on University business. If an employee uses his/her own personal vehicle while on University business and is in an accident, their personal insurance is primary and the employee would be responsible for any deductibles.
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