Who Pays for the Rental Car After an Accident in Houston, Texas?

When a car accident leaves you without transportation, it’s natural to ask who pays for the rental car after an accident, and what your options are while your car is being repaired.

In Texas, the answer depends on who caused the accident, what coverage applies, and how long repairs take. While the process may seem straightforward, many drivers are caught off guard by policy limits, coverage delays, or confusion over which insurance company should pay. Understanding your options before you rent can prevent frustration and out-of-pocket expenses later.

Texas Is a Fault-Based State for Car Accidents

Before you can determine who pays for a rental car, it helps to understand how Texas handles car accidents. The state follows a fault-based insurance system, meaning the driver who causes the crash is legally responsible for the damages. This includes vehicle repairs, medical expenses, and the cost of a rental car while yours is being repaired.

Under Texas Transportation Code §550.061, drivers must report any collision involving injury, death, or significant property damage to law enforcement. The police report becomes an important piece of evidence when determining fault and filing insurance claims.

If another driver is found responsible, their insurance company should pay for your rental car. However, insurers often delay approval until liability is confirmed. That’s why it’s important to document the accident carefully, file your claim promptly, and keep records of all related expenses to prevent unnecessary delays.

What Your Own Insurance Might Cover After a Houston Car Accident

If your policy includes rental reimbursement coverage, your own insurance company may pay for a rental car while your vehicle is being repaired. Once the at-fault driver’s insurer accepts liability, your insurer can often recover what it paid through subrogation.

This type of coverage is optional, but can protect you from paying rental costs upfront. Under Texas Insurance Code Chapter 1952, insurers may offer rental reimbursement as an add-on with limits that vary by company and policy.

Coverage usually lasts until your car is repaired or up to the maximum number of days listed in your policy. Some insurers require you to rent through an approved provider, so it’s worth confirming those details before signing a rental agreement.

Texas insurers typically cover a comparable vehicle, one similar in size and type to the damaged car, not an upgrade. If you choose to rent a larger or more expensive vehicle, you’ll likely be responsible for paying the difference yourself. Reviewing your declarations page or calling your insurer before renting can prevent unexpected costs later.

When the Other Driver’s Insurance Should Pay for Your Rental Car in Texas

If the other driver is at fault, their insurance company is typically responsible for reimbursing your rental car costs under their property damage liability coverage. However, payment isn’t always immediate. This is why many drivers initially use their own rental reimbursement coverage (if they have it) or pay out-of-pocket, as the at-fault insurer often waits for confirmation of liability.

Insurers often wait for the police report, witness statements, or other supporting documents before approving rental expenses. In the meantime, you may need to pay for the rental yourself and request reimbursement once liability is confirmed. Keep receipts, the rental agreement, and any communication with the insurer to support your claim.

The other driver’s insurer may:

• Limit reimbursement to a vehicle similar in size and type to yours.
• Deny payment for upgraded or luxury rentals.
• End coverage once your car is declared a total loss.

If the claims process takes longer than expected, staying organized and keeping records of your out-of-pocket expenses will make it easier to seek recovery for those costs later. If coverage still isn’t approved after several days, the rental company itself may be able to coordinate billing directly with the insurer.

When the Rental Company Bills the Insurance Carrier Directly

In some Houston auto accident cases, the rental company can bill the insurance carrier directly once you provide a claim number. Larger providers such as Enterprise, Hertz, and Avis often work with insurers to handle the payment process on your behalf.

Before signing any rental agreement, confirm that the insurance company has approved coverage and payment terms. If the insurer later denies liability or delays processing the claim, the rental company may hold you personally responsible for the charges.

Direct billing can simplify things if handled correctly, but always keep your own records, including the rental contract, mileage logs, and any confirmation emails, to avoid future disputes over payment.

If no insurer accepts liability right away, you may still need to pay out of pocket and request reimbursement later.

Paying for a Rental Car Yourself and Requesting Reimbursement Later

When fault is still being investigated, it’s common for drivers to cover the rental cost out of pocket and file for repayment once the claim is settled. To make that process smoother, stay organized and gather documentation from the start.

Here’s what helps strengthen your reimbursement claim:

• Save every receipt and rental agreement. These serve as proof of cost and rental duration.
• Keep written communication with both insurers about the rental dates and expected repair timeline.
• Avoid upgrades or add-ons beyond what you normally drive, since insurers typically only reimburse for a comparable vehicle.
• Track how long your car remains in the shop, as this often determines how much reimbursement you can request.

If the insurance company later disputes part of your claim, these records can make it easier to show what expenses are tied directly to the accident.

Why Rental Car Coverage Can Be Denied

Even when you do everything right, insurance companies sometimes refuse or limit rental reimbursement. Common reasons include:

• The insurer disputes who was at fault.
• The rental period exceeds what they consider a “reasonable repair time.”
• The vehicle is declared a total loss instead of being repaired.
• The claim lacks documentation or was not filed promptly.

If your rental coverage is denied, contact the insurance adjuster for a written explanation. Often, the problem is simply missing paperwork or a misunderstanding about your policy. Keeping clear records of each conversation, estimate, and payment request makes it easier to challenge a denial and recover what you paid.

If you’ve followed each step and still can’t get your rental costs approved, it may be time to explore additional options.

When to Consider Legal Guidance

If you’ve exhausted every option and the insurance company still refuses to cover your rental car, it may be time to speak with a legal professional familiar with Texas car accident laws. A Houston, Texas car accident lawyer can review your claim, identify what’s causing the delay, and explain whether additional legal action might be appropriate.

Dealing with insurance after an accident can be stressful, and you may also be juggling repairs, medical appointments, and everyday responsibilities. By keeping detailed documentation and understanding your coverage early on, you can limit delays and protect your financial recovery while your car is being repaired.

Get Back Behind the Wheel With The Mahdavi Law Firm PLLC

A car accident can disrupt your entire routine, especially when you’re left waiting for the insurance company to do the right thing. When you’re looking for car accident lawyers in Houston, Texas, you need a team that knows how to cut through red tape, handle the back-and-forth with adjusters, and keep your case moving forward.

At The Mahdavi Law Firm PLLC, we handle each detail, from rental car reimbursement and property damage claims to medical treatment coordination and lost income documentation. Our attorneys know how to hold insurers accountable when they delay, deny, or undervalue your claim.

We make the process as efficient and transparent as possible from day one. Our team also provides the personal service that large firms can’t match. We arrange Uber transportation for clients when needed and assist with property damage at no charge.

When you’re hurt, we hit back. Call 855-MAHDAVI or complete our confidential online form to schedule your free case evaluation with a Texas personal injury lawyer today. You’ll speak directly with an attorney who takes the time to listen, explain your options, and pursue full and fair compensation for your losses.

We don’t charge a dime unless we win. Our goal is simple: help you move forward with confidence and financial security.

Copyright © 2025. The Mahdavi Law Firm PLLC. All rights reserved.

The information in this blog post (“post”) is provided for general informational purposes only and may not reflect the current law in your jurisdiction. No information in this post should be construed as legal advice from the individual author or the law firm, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting based on any information included in or accessible through this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country, or other appropriate licensing jurisdiction.

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Houston, Texas  77027
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