Disclaimer: This article is for general informational purposes only and does not constitute legal advice. Consult an attorney for advice specific to your situation.
Understanding Loss-of-Use Claims When Policy Limits Are Exhausted
In Vermont, at-fault drivers must carry a minimum of $10,000 in property damage liability insurance. (See 23 V.S.A. § 891(b)(2).) When that limit is reached, you cannot claim additional loss-of-use or rental expenses from the at-fault driver’s insurer. However, you have other options to recover these costs.
First-Party Coverage Options
Review your own auto insurance policy for these optional coverages:
- Rental Reimbursement Coverage: Pays actual rental car expenses while your vehicle is repaired or replaced. Check your declarations page for daily and total limits.
- Uninsured/Underinsured Motorist (UM/UIM) Property Damage Coverage: If you purchased UM/UIM property damage coverage, it often includes loss-of-use benefits. Vermont law requires insurers to offer this option (see 23 V.S.A. § 1127a(c)-(d)).
To file a first-party claim:
- Notify your insurer as soon as possible after the accident.
- Provide rental invoices and repair estimates showing when your vehicle will be unavailable.
- Document fair daily rental rates in Vermont to support your loss-of-use claim.
Suing the At-Fault Driver Directly
If you did not purchase optional coverage or your limits are still insufficient, you may pursue the at-fault driver personally:
- Civil Lawsuit for Negligence or Conversion: File in Vermont Superior Court or small claims court for up to $5,000 in loss-of-use or rental expenses.
- Asset Investigation: Determine if the at-fault driver has additional assets—bank accounts, real estate, or higher-limit umbrella policies—to satisfy a judgment.
Key Steps to Protect Your Rights
- Act promptly: Observe all claim deadlines in your policy and Vermont court rules.
- Keep detailed records: Rental agreements, repair timelines, photos of damage, and correspondence.
- Obtain multiple repair estimates to establish a reasonable repair timeframe.
- Consult an attorney if liability or coverage issues arise.
Conclusion
When an at-fault driver’s policy limits are exhausted in Vermont, file a first-party claim under your optional rental reimbursement or UM/UIM property damage coverage if available. Otherwise, consider suing the driver directly to recover loss-of-use or rental car expenses. Proper documentation and timely action maximize your chances of full recovery.