What is Loss of Use Car Insurance: A Complete Guide

June 17, 2024

What is loss of use car insurance? It's a crucial component of your overall vehicle protection plan, especially when your car is rendered unusable due to an accident or other covered incident. This type of insurance steps in to cover your transportation costs when your vehicle is being repaired. Now, let's delve into various aspects of loss of use car insurance, its benefits, and what you need to know to make a successful claim.

Loss of Use Claim Calculation

The first step in understanding what is loss of use car insurance is knowing how the claims are calculated. Typically, these claims consider the rental costs of a similar vehicle, per diem rates, and the estimated repair time. The reasonable value of a rental vehicle during the repair period is generally considered, and insurance companies may use local averages to determine the daily payable amount.

Proving Loss of Use Damages

To support a loss of use claim effectively, you must provide proof of ownership and establish the period during which you lacked transportation. Additionally, you have a duty to mitigate damages, which means you should take reasonable steps to reduce the financial impact, such as using alternative transportation options.

Additional Compensation Claims

Besides claiming loss of use, you may be entitled to other compensations after a car accident. These include a loss of income claim, diminished value claim, personal injury claim, and uninsured/underinsured motorist claim. It's important to explore all potential claims to ensure comprehensive financial recovery.

Seek Legal Representation

Navigating the loss of use claims process can be challenging, especially when dealing with complex situations or uncooperative insurance companies. Seeking legal representation can significantly improve your chances of an effective claim. An experienced attorney can guide you through the nuances of the California Insurance Code to ensure you receive the compensation you deserve.


Frequently asked questions around loss of use claims often include details about what is loss of use car insurance, what it covers, and how to calculate a claim. For instance, at-fault parties are primarily responsible for covering their loss of use expenses unless they have specific rental car coverage. Also, the type of rental vehicle you can claim reimbursement for will depend on the vehicle involved in the claim and your policy specifics.

Important Considerations and Disclaimer

When filing a loss of use claim, it's crucial to keep all receipts for rental cars, provide a police report, and document your vehicle's condition before the incident. It is also worth noting that loss of use coverage is an optional add-on but can be highly beneficial in reducing financial stress following an accident.

Disclaimer: This article provides general information and should not be considered legal advice. For personalized legal guidance, consult a professional attorney.

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