As a car rental company owner, you are always looking for ways to increase revenue and grow your business. However, it’s important to be aware of potential risks when renting out high-valued vehicles to Progressive Insurance policyholders.
Recently, Progressive Insurance introduced an endorsement (form A340, 01/22) on all private passenger auto policies that lowers the payout limit for rental vehicles with a manufacturer suggested retail price equal to or greater than $100,000. This means that if a renter with a Progressive Insurance policy gets into an accident and damages a high-valued rental car, the payout for damages may be limited to the actual cash value of the highest valued vehicle on the policy.
What does this mean for car rental companies? It means that you could potentially face significant financial losses if a renter with a high-valued Progressive Insurance policy damages one of your rental cars. If the actual cash value of the highest valued vehicle on the policy is less than the cost to repair or replace the rental car, you could be left with a substantial gap in coverage.
So, what can you do to protect your business? One option is to require renters with Progressive Insurance policies to purchase additional coverage to cover any potential gaps in coverage. This could include collision damage waiver (CDW) or supplemental liability insurance (SLI). By requiring additional coverage, you can ensure that your business is protected and that you can continue to grow your business without facing significant financial losses.
Another option is to limit the types of high-valued vehicles that you rent out to Progressive Insurance policyholders. By limiting the rental options, you can limit the potential financial risks to your business.
In conclusion, while it’s important to provide your customers with a range of rental options, it’s equally important to be aware of potential risks when renting to Progressive Insurance policyholders with high-valued vehicles. By taking steps to protect your business, you can continue to grow your business and provide excellent customer service to all of your renters.