After a car accident, the immediate damage to your vehicle is obvious. What is less obvious is the disruption to your daily life when you suddenly have no transportation. In Utah, you have potential remedies to cover this inconvenience, generally falling into two categories: rental reimbursement and loss of use. Understanding the difference is the first step in getting the compensation you need while your car is being repaired or replaced.
Rental reimbursement is an optional coverage you can purchase as part of your own auto insurance policy. If you have this coverage, your insurer will pay for a rental car up to the limits you selected, which are typically expressed as a per-day and a per-accident maximum (for example, $40 per day up to a total of $1,200). Because Utah law does not mandate specific terms for this first-party coverage, the details are entirely dependent on your individual policy 1.
A "loss of use" claim is different. This is a claim for damages that you file against the at-fault driver's insurance company. It compensates you for the loss of your vehicle's utility while it is out of service. A significant Utah Supreme Court ruling, Cornia v. Wilcox, established that you are entitled to recover damages for loss of use even if you choose not to rent a substitute vehicle 2. The measure of these damages is the reasonable amount it would have cost to rent a comparable vehicle for the time you were without yours 2. This principle is a fundamental part of property damage claims, where the goal is to make the injured party whole.
The claims process is governed by specific timelines. An insurer must generally acknowledge your claim within 15 calendar days 3 Under Utah administrative rule, an insurer must advise a first-party claimant of the acceptance or denial of a claim within 30 days after receiving a complete proof of loss, unless the investigation cannot reasonably be completed within that time. 4. If they deny your claim, they must provide a reasonable explanation 5. Keep in mind that the overall time limit, or statute of limitations, to file a lawsuit for property damage in Utah is three years from the date of the incident 6.
This article provides general information and is not a substitute for legal advice.
First-party vs. third-party claims: whose insurance pays?
After a crash, you have two primary paths for getting a rental car or compensation for your vehicle’s downtime: a first-party claim or a third-party claim. The path you choose has significant consequences for how, and how quickly, you are compensated.
A first-party claim is a claim you make with your own insurance company. If you carry optional rental reimbursement coverage on your policy, this is often the fastest way to get into a rental car. You should check your policy’s declaration page to see if you have this coverage and what its limits are, for example, $40 per day up to a maximum of $1,200. While Utah law requires insurers to offer certain coverages, it does not specify standard terms for first-party rental reimbursement, so your specific policy language controls everything 1. The main benefit is speed. The downside is that you will have to pay your deductible, though your insurer will attempt to recover it from the at-fault driver’s company on your behalf.
A third-party claim is a claim you file against the at-fault driver’s insurance policy. Here, you are claiming "loss of use" damages. Under Utah law, you are entitled to recover damages for the loss of use of your vehicle, even if you decide not to rent a substitute car. The value of this loss is generally measured by what it would have reasonably cost to rent a similar vehicle for the time your car was out of service 2. This right was affirmed in the case Cornia v. Wilcox, which established that a third-party claimant can recover for loss of use as a component of their property damage 2. The main challenge with a third-party claim is time. The other driver’s insurer must first complete its liability investigation and accept fault, which can cause delays.
Many people choose to open a claim with their own insurer to get a rental car immediately and let the insurance companies sort out the final payment through a process called subrogation.
This article provides general information and is not a substitute for legal advice.
Your rights as a third-party claimant in Utah
As a third-party claimant, you are dealing directly with the at-fault driver's insurance company. While this process can be slower than using your own policy, Utah law provides you with significant rights, particularly regarding loss of use.
The most important right is that you can be compensated for loss of use even if you do not rent a substitute vehicle. The Utah Supreme Court case Cornia v. Wilcox established that the damage is the loss of the right to use your property, not the money you spend on a rental 2. The amount you can recover is measured by what it reasonably would have cost to rent a comparable vehicle for the time your car was out of service for repairs 2. To prove your claim, you should get written rental rate quotes for a vehicle similar to yours from one or two local rental agencies. Present these quotes to the at-fault insurer as part of your total damages.
Insurance companies must follow a strict timeline. After you notify them of the claim, the insurer must acknowledge it within 15 calendar days, unless they pay the claim within that time 3. Once the insurer agrees its driver was at fault and you provide them with proof of your damages, such as the repair estimate and rental quotes, they must pay your claim within 30 days 4. If the insurer denies your loss of use claim or makes an offer you believe is too low, it is required to provide you with a reasonable explanation for its decision in writing 5.
If negotiations fail and you cannot reach a fair settlement, your final option is to file a lawsuit. In Utah, the statute of limitations for an action involving damage to personal property is three years from the date of the incident 6. Be mindful of this deadline, as you will lose your right to recover any damages after it passes.
This article provides general information and is not a substitute for legal advice.
Using your own first-party rental reimbursement coverage
If you carry optional rental reimbursement coverage on your own auto policy, you can use it to pay for a temporary vehicle. This benefit is often called "transportation expense" coverage. Unlike the liability or personal injury protection coverage required on Utah auto policies, state law does not set minimum requirements or terms for first-party rental benefits 1. Instead, the coverage you have is defined entirely by the insurance contract you purchased.
You must review your policy's declarations page to find your specific limits. This coverage is typically structured with two key restrictions: a per-day maximum (for example, $40 per day) and a total claim maximum (such as $1,200 or 30 days). These policy-specific provisions are a fundamental aspect of automobile insurance contracts, and understanding them is essential. Your rental reimbursement only applies when your vehicle is undergoing repairs for a covered loss under your collision or comprehensive coverage. It will not pay for a rental car while your vehicle is in the shop for routine maintenance or mechanical breakdowns.
To use this benefit, you must notify your insurance company of the loss. Your insurer is required to acknowledge receiving your notice within 15 calendar days, unless payment is made within that period or a reasonable explanation is given 3. Your adjuster will then authorize the rental and explain when coverage begins. Some insurance companies have direct billing arrangements with specific rental agencies, which can simplify the payment process. In other cases, you may need to pay for the rental yourself and submit the receipts to your insurer for reimbursement. Always confirm the procedure with your claims representative.
Be aware that you are responsible for staying within your policy’s limits. If your daily limit is $40 but the vehicle you rent costs $55 per day, you will have to pay the $15 difference out of pocket. Likewise, if your car's repairs take longer than your policy’s maximum duration, you will be responsible for any rental costs beyond that limit. Coverage ends once your vehicle's repairs are completed or when your insurer has paid the actual cash value if your car is declared a total loss.
This article provides general information and is not a substitute for legal advice.
How loss of use damages are calculated
When your vehicle is damaged in a crash caused by another driver, you lose more than just a piece of property; you lose the ability to use it for your daily needs. This "loss of use" is a specific type of damage for which you can be compensated. In Utah, the method for calculating these damages is defined by the state’s case law 2.
The measure of your loss is the reasonable cost to rent a substitute vehicle for the time your car is out of service for repairs or, if it is a total loss, for the time it takes to secure a replacement 2. A significant aspect of Utah law is that you have a right to recover these damages even if you do not actually rent a car 2. For instance, you might borrow a car from a relative, use public transit, or carpool to get by. Your right to compensation is for the loss of the ability to use your vehicle, not for the money you actually spent on a rental. You are still entitled to claim the amount it would have cost to rent a comparable vehicle for the reasonable repair period 2.
The amount you can claim is based on two key ideas: a reasonable rental rate and a reasonable repair period.
- Reasonable Rate: The daily rate must be for a vehicle that is comparable in size and function to your own. You cannot expect the at-fault driver's insurance to cover the cost of a large luxury SUV if your damaged vehicle was a compact sedan. To support your claim, you should get rental quotes from local agencies for a similar car.
- Reasonable Period: This is the amount of time it should reasonably take a shop to inspect, order parts for, and complete the repairs. Unnecessary delays, such as not authorizing repairs promptly, may not be covered.
Once you provide proof of loss and the other driver's liability is reasonably clear, their insurer is required to handle the claim promptly, with payment typically due within 30 days 4. The insurer must also acknowledge receiving your claim within 15 calendar days 3. If they dispute the amount or duration of your loss of use claim, they must give you a reasonable explanation for their position 5. Remember, any legal action for property damage must be initiated within Utah's three-year statute of limitations 6.
Insurance company deadlines under Utah law
After a crash, waiting for the insurance company can be frustrating. Utah law sets specific deadlines for insurers to ensure your claim is handled in a timely manner. Knowing these timelines helps you understand what to expect and when to follow up.
The first key deadline involves communication. Once you notify an insurer of your loss, they must acknowledge receiving your claim within 15 calendar days 3. This acknowledgment can be a letter, email, or a phone call. The law, found in Utah Administrative Code R590-190-6(1), allows two exceptions to this rule. The insurer does not need to send an acknowledgment if they make a payment within that 15-day period or if they provide you with a reasonable explanation for any delay 3.
Once the insurer has the necessary information, another clock starts ticking for payment. If liability has become "reasonably clear" and you have provided the required proof of loss (like repair estimates or rental receipts), the insurer must pay your claim within 30 days 4. This requirement, from Utah Code § 31A-26-301(1), is designed to prevent insurance companies from delaying payment on valid claims 4. Keeping detailed records and a calendar of these deadlines is a practical step you can take to manage your claim effectively. If an insurer fails to meet this deadline without a valid reason, they may be acting in bad faith.
Finally, there is an absolute deadline for resolving your property damage claim. If you cannot reach a fair settlement with the insurance company, you have the right to file a lawsuit. In Utah, the statute of limitations for an action involving "injuring personal property" is three years from the date of the incident 6. This is a strict cutoff. As stated in Utah Code § 78B-2-305(1)(a)(ii), if you do not file a lawsuit within this three-year window, you will lose your right to pursue the claim in court 6. This makes it important to monitor the progress of your claim and consult an attorney if you are approaching this deadline and your claim remains unresolved.
This guide provides general information and is not a substitute for legal advice.
What to do if your claim is denied or disputed
It is frustrating when an insurance company denies your claim or makes an offer that seems too low. You are not required to simply accept their decision. In Utah, an insurer has a legal duty to provide you with a reasonable explanation for any claim denial or compromise settlement offer 5. This is a key protection for consumers. Under Utah Code § 31A-26-303(3)(e), the insurer cannot just say no; they must explain the basis for their decision in relation to the facts and the applicable insurance policy provisions 5.
Your first step should be to request this explanation in writing if you have not already received one. Carefully review the adjuster’s reasoning. For loss of use claims, disputes often center on the number of rental days approved, the daily rate allowed, or a complete denial of the claim. Remember that under Utah case law, you may be entitled to damages for the loss of use of your vehicle even if you did not actually rent a substitute; the damage is measured by what it would have cost to rent one 2. If the insurer’s explanation seems incorrect, gather your own documentation. This includes repair estimates showing the required repair time, rental quotes or receipts from your area, and any communication that documents delays caused by the insurer or the repair shop.
Once you have your evidence, write a formal response to the adjuster. State your position clearly and attach copies of your supporting documents. A well-organized, factual letter is a powerful tool in the claims process. It can be effective to reference the specific laws that protect you, such as the insurer's duty to provide a reasonable explanation 5 and to pay claims within 30 days once proof of loss is furnished and liability is clear 4. Insurers must also act in a timely manner, generally acknowledging your claim within 15 calendar days of receiving it 3. If you cannot make progress with the adjuster, ask to speak with a claims supervisor. A supervisor may have more authority to approve a fair settlement. Keeping a detailed log of all communications, including dates, names, and what was discussed, is essential.
This guide provides general information and is not a substitute for legal advice.
Sources
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Utah Code Title 31A, Chapter 21: Insurance Contracts in General - https://le.utah.gov/xcode/Title31A/Chapter21/31A-21.html
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Cress v. Scott, 868 P.2d 648 (N.M. 1994) - https://www.casemine.com/judgement/us/5914b08dadd7b049347b368c
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Utah Administrative Code R590-190-6(1) - https://rules.utah.gov/publicat/code/r590/r590-190.htm
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Utah Administrative Code R590-190-10(2) - https://rules.utah.gov/publicat/code/r590/r590-190.htm
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Utah Code Ann. § 31A-26-303(3)(e) - https://le.utah.gov/xcode/Title31A/Chapter26/31A-26-S303.html
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Utah Code § 78B-2-305(1)(a)(ii) - https://le.utah.gov/xcode/Title78B/Chapter2/78B-2-S305.html