The Rental Car Shortage: What Does It Mean for Auto Coverage?


Many travelers have had difficulty reserving and acquiring rental cars for over a year. As early as mid-2020, rental companies sold off inventory during the reduced demand, and now, a microchip shortage is causing a delay in car manufacturing that hinders rental companies’ ability to replenish their fleets.

The rental car shortage, which began under the COVID-19 pandemic, is expected to continue well into 2022 and is anticipated to worsen during holidays and other high-travel times. This leaves some travelers, who would have otherwise relied on rental cars, in something of a bind, and many policyholders need to evaluate how their auto insurance coverage could affect the choices they may when dealing with this shortage.

Taking your own car

With the rental car shortage, many travelers are choosing to rely on their own car for transportation, which means added wear and tear on their personal vehicles and additional miles. Another effect of the pandemic was the increase in employees working from home. Many people who no longer need to commute to the office switched to low-mileage policies to save money, and these policies may not accommodate long-distance travel. Before setting off on any trip, it’s a good idea to check your auto insurance policy to be sure your trip will be covered.

Relying on taxis and public transit

Some travelers who would have typically relied on rental cars are changing up their plans. Instead, many are flying to a destination and relying on public transit and taxis. If you select this option, be sure to choose well-established and reliable companies for your transportation. You’ll want to ensure that the company carries insurance and is licensed. Travelers can also check for feedback and ratings to help them find options with companies that have a proven track record and offer quality service.

Sticking with rental cars

Despite the shortage, some travelers still want to use rental cars, and they’ve found ways of accommodating their plans. Some find that booking earlier and being flexible with booking details allow them to find available rental vehicles. It can also be helpful for travelers to watch for deals that can reduce inflated costs, and renting from less popular locations can also help with availability issues. If you choose to use a rental car still, be sure to take a moment and consult with your insurance agent about your auto insurance policy. Knowing what your policy covers can help you make an informed decision about the insurance the rental company will offer you, which can mean saving you money without sacrificing your peace of mind.

Consult an expert

Whatever option you choose for your travel plans this year, be sure to take some time in 2022 to review your auto insurance. Knowing what your policy covers and evaluating your needs can help you be sure you have the best option for the best price. Contact Westwood today to compare options, or get a quote right away.