Glossary

Loss of use

Compensation for not being able to use your car while it is repaired or replaced after a crash someone else caused, usually paid as a rental car.

Also called: loss of use damages, loss of use claim

Loss of use is the cost of being without your vehicle after it is damaged. When another driver causes a crash, their property damage liability coverage generally owes you not only the repairs but also reasonable compensation for the time you cannot drive your car. Insurers usually pay it by providing or reimbursing a comparable rental car; some pay a daily amount instead if you do not rent one.

The period typically runs for the reasonable time needed to repair the car or, if it is a total loss, until the insurer makes a fair settlement offer. Example: the at-fault driver's insurer accepts liability, and the body shop needs 12 days. At a $45 daily rate for a comparable rental, the loss-of-use payment would be about $540 (hypothetical figures). Delays you cause, such as waiting weeks to bring the car in, may not be covered.

On your own policy, the equivalent protection is rental reimbursement, which pays up to a set daily and total limit when you have a covered collision or comprehensive claim, whoever caused it. That matters when fault is disputed or the other driver is uninsured. Rental companies can also charge you for loss of use when a rented car is damaged, and your policy or credit card may or may not cover that charge. See repair delays, parts shortages and running out of rental coverage.

Last reviewed October 4, 2026

In the index now

Related terms

Rental reimbursement Optional coverage that pays for a rental car or other transportation while your car is repaired after a covered claim, up to daily and total limits. Third-party claim A claim you make against another driver's insurance for damage or injuries that driver caused, rather than against your own policy. Property damage liability The part of liability coverage that pays for damage you cause to other people's cars and property, such as fences, buildings and poles. Total loss A car so badly damaged that repairs would cost more than it is worth, or more than a state threshold, so the insurer pays its value instead. Diminished value The resale value a car loses after a crash, even when fully repaired, because buyers pay less for a car with an accident history.

Related guides

Accidents in a rental car: whose insurance pays How your auto policy, a credit card benefit and the rental company's waiver split the bill after a rental car crash, and the fees that slip through. Bundling renters and auto insurance Why adding a renters policy can cut your car insurance bill, what renters coverage adds that auto does not, and how to check the math before you bundle. Rental reimbursement coverage How rental reimbursement pays for a rental car while yours is repaired after a covered claim, the daily and total limits, and how much to buy. Repair delays, parts shortages and running out of rental coverage Why repairs drag on, how rental reimbursement limits run out, what the at-fault driver's insurer owes for loss of use, and what to do when rental days end.

Related insurers

Alfa Insurance The Alabama Farmers Federation's insurer, a Montgomery-based mutual selling auto through local agents in Alabama, Georgia and Mississippi since 1946.