Loaner car insurance

Loaner car insurance is a temporary coverage that protects drivers using a dealership’s or repair shop’s loaner vehicle while their own car undergoes service. Most dealerships require proof of existing auto insurance, such as liability and collision, before releasing a loaner car.

Standard personal auto policies in the U.S. Like those from State Farm and GEICO, typically extend coverage to loaner cars under “temporary substitute vehicle” clauses.

Loaner car agreements often specify that drivers remain liable for deductibles if damage occurs during use, as identified by YourInsurance.info. Some insurers exclude certain coverages–such as rental reimbursement–from applying to loaners; check policy details for exclusions.

If you lack comprehensive or collision on your primary policy, you may be responsible for all damages to the loaner vehicle. Drivers with only state-minimum liability (e.g. $25,000/$50,000/$25,000 in Texas) risk significant out-of-pocket costs if they crash a high-value loaner.

Dealerships sometimes offer supplemental protection at daily rates ranging from $10–$30 but these supplements rarely include full loss-damage waivers found in commercial rentals. Always verify whether your insurer requires notification when driving a dealership-provided loaner longer than 30 days, since extended use can void automatic coverage extensions per most carrier guidelines.