Concept and general definition of rental car costs
Under rental car costs one understands those costs that arise in connection with the rental of a vehicle. These costs regularly occur when using rental cars as a replacement for a vehicle that has been damaged in an accident or is temporarily unusable. They include both the base rental price and any additional costs for special services, insurance, and service fees. Particularly in the context of traffic law and tort law, rental car costs play a central role.
Legal basis of rental car costs
Civil law classification
In the context of civil law, rental car costs constitute a part of the damage to be compensated. The legal basis here is § 249 (2) sentence 1 BGB (German Civil Code). It stipulates that in the case of liability damage, the injured party is entitled to claim the money required for restoration. Restoration also includes bridging the downtime of a vehicle by renting a replacement vehicle.
Compensability of rental car costs
The compensability of rental car costs requires that the injured party is dependent on renting a replacement vehicle due to the loss of their own car. According to the highest court rulings, the claim for reimbursement of rental car costs exists in principle:
- For the duration of the repair or replacement of the vehicle
- To the extent the rental car is actually used (comparison of the type of vehicle with the damaged car)
- Within the usual and necessary cost framework
Scope of reimbursable rental car costs
Principle of necessity (§ 249 BGB)
According to the so-called principle of economic efficiency, the injured party may only claim compensation for those damage items which are objectively necessary for damage repair. This means that costs above the local average rental price for a comparable vehicle are usually not fully reimbursable.
Selection of the rental car
The injured party is in principle required to rent a replacement vehicle comparable to the accident-damaged vehicle. If a higher-class vehicle is rented, the additional costs are generally not reimbursable, unless no vehicles of the same class are available on the market.
Rental period
The rental period for which costs can be reimbursed is generally based on the objectively necessary time for repair or for replacement in the case of total loss. Here, the injured party must actively contribute to minimizing the damage (duty to cooperate, § 254 BGB), for example, by promptly commissioning the repair.
Ancillary costs and additional services
In addition to reimbursable rental car costs, other items such as liability reduction, delivery service, additional driver fees, or child seats may be included, provided that these are necessary for damage repair in the specific case. Whether these additional costs are to be compensated is decided in the event of a dispute according to the concrete circumstances.
Liability aspects
Rental car costs regularly arise as a damage item within the context of liability for tortious acts (§§ 823 et seq. BGB) or contractual liability (e.g., in rental or leasing law). In the field of motor vehicle liability insurance, rental car costs are a typical damage item to be borne by the party at fault or their insurer, provided that the legal prerequisites are met.
Rental car costs in insurance law
Liability insurance
In the event of an accident for which they are not at fault, the injured party is entitled to reimbursement of the necessary rental car costs from the liability insurance of the party responsible for the accident. The assessment of reimbursability is made based on the above principles (necessity, economic efficiency).
Comprehensive insurance
In comprehensive insurance, as a rule, there is no claim for rental car costs, as it only covers damage to one’s own vehicle. Exceptions may apply with special tariffs or additional services offered by individual insurers.
Direct payment and guarantee
Some insurers offer the possibility to settle rental car costs directly with the rental car company (so-called direct settlement), releasing the injured party from making advance payments.
Calculation methods and estimation of rental car costs
Customary market price lists
To determine the usual market rental car costs, publicly available price lists are often used. In case law, the Schwacke list and the Fraunhofer rental price index are among those used. In the event of a dispute, courts often refer to these lists according to prevailing market conditions and may estimate the necessary costs (§ 287 ZPO).
Consideration of savings on own vehicle costs
The use of a rental car results in savings for the injured party on their own operating costs (particularly for oil, tire wear, maintenance). These saved expenses are typically offset against the claim as a percentage deduction (generally between 3% to 10% of the rental price).
Duty to mitigate loss and obligations
Duty to mitigate loss (§ 254 BGB)
The injured party is obliged to keep the costs of damage repair as low as possible. This is the so-called duty to mitigate loss. This may include, for example, obtaining quotes from various rental companies, opting for less expensive vehicles, or taking advantage of special rates such as courtesy cars offered by repair shops.
Compensation for loss of use as an alternative claim
In cases where no rental car is used, the injured party may alternatively claim compensation for loss of use. This is particularly relevant when the need for a replacement vehicle cannot be proven or renting a car would not have been economically reasonable.
Typical litigation issues regarding rental car costs
- Compensability of additional services such as navigation devices or winter tires
- Applicability and weighting of the Schwacke list or Fraunhofer table for determining local prices
- Scope of the duty to cooperate in cases of long repair times or delayed replacement acquisition
- Requirements for the injured party’s obligation to provide evidence regarding incurred costs and necessity of the rental
Summary and outlook
Rental car costs are a significant cost item in tort law and insurance law that are subject to detailed legal scrutiny with respect to their compensability, amount, and appropriateness. The key criteria for reimbursement are especially the principles of necessity and economic efficiency, the individual situation of the injured party, and the current market conditions. Future developments in case law will primarily concern the shaping of estimation methods and handling of additional costs in the digital age, such as covering costs for electric replacement vehicles or flexible mobility services.
Frequently Asked Questions
What legal principles determine the reimbursability of rental car costs after a traffic accident?
Rental car costs after a traffic accident are governed primarily by §§ 249 et seq. of the German Civil Code (BGB), which encompass the law of damages under German civil law. According to § 249(2) sentence 1 BGB, the injured party must be placed in the position they would have been in without the damaging event. Therefore, renting a replacement vehicle for the duration of accident-related repairs is generally permissible and reimbursable, provided it corresponds to the loss of use of the injured party’s own vehicle. There is often disagreement as to the extent to which rental car costs must be covered, since the injured party is obligated, under the principle of economic efficiency, to keep the damage as low as possible. Excessive rental car prices (“accident replacement tariffs”), lack of or insufficient evidence of necessity, and the obligation to mitigate loss (§ 254 BGB) can legally limit reimbursement.
When is renting a rental car ‘necessary’ in the legal sense?
The necessity for hiring a rental car depends on whether, and to what extent, it was reasonable from the point of view of a sensible injured party. Crucial are vehicles needed mandatorily for continuity of professional or private life. In any case, the injured party must prove they rely on the vehicle and could not have used public transport or replacement vehicles from family or friends during the repairs. Jurisprudence requires a subjective evaluation, i.e., the individual situation of the injured party (age, health, place of residence, family obligations) is taken into account. If a rental car is obtained ‘for stock’ or out of pure convenience, claims can be denied.
To what extent (amount) must the person responsible for the accident or their insurer reimburse rental car costs after an accident?
The party responsible for the accident or their liability insurer is required to cover the ‘necessary’ rental car costs. As a rule, the locally and temporally usual standard rate (often determined by the Schwacke list or Fraunhofer market price index) is considered necessary. If the injured party significantly exceeds this rate—e.g., by accepting an accident replacement tariff well above market levels—generally only proven excess costs are reimbursable, if special circumstances applied (e.g. urgency, lack of alternatives). Additional services, such as comprehensive insurance or additional drivers, are only reimbursable if they are objectively necessary, provable, and explained to the injured party at contract conclusion.
What cooperation obligations (duty to mitigate loss) apply to the injured party in relation to rental car costs?
According to § 254 BGB, the injured party is required to cooperate in repairing the damage and to refrain from anything that could unnecessarily increase the damage. In the context of rental car costs, this means, in particular, obtaining different offers and deciding on the cheapest equivalent vehicle. Accepting excessively high accident replacement tariffs may lead to reduced reimbursement. The injured party should also check whether they could forego the rental car by using public transportation, carpools, company vehicles, or a second car. Furthermore, the rental car must be returned immediately once the injured party’s own vehicle is usable again.
What evidence is required to assert claims for rental car costs?
Case law in principle requires complete documentation of the claims prerequisites. This includes: proof of rental (rental agreement, invoice), a detailed explanation of the necessity of use (e.g. employer’s certificate, family commitments), information about the accident-related period during which the vehicle was inoperative (expert opinion or repair invoice with repair duration), and a comparison of rates (e.g. price comparisons from local providers). Receipts must prove all contractual services—especially additional costs such as delivery, insurance, etc. Otherwise, there is a risk of the claim for reimbursement being reduced or entirely denied.
Is reimbursement of costs for a higher-class rental vehicle than the damaged vehicle legally permissible?
Legally, only renting a vehicle of the same or at least a comparable class to the damaged car is generally reimbursable, to create a financial balance and not an unjust enrichment of the injured party. If the rental vehicle exceeds the damaged vehicle in equipment and value, costs are usually limited to the amount of an equivalent vehicle. Exceptionally, higher-class rental may be justified if no cheaper vehicle is available or a particular business or private necessity can be demonstrated—for example, in the case of unforeseen spare part shortages.
What are the essential legal criteria for the period during which rental car costs are reimbursable?
The claim for reimbursement of rental car costs exists in principle for the objectively necessary repair time (often referred to as the ‘required restoration period’), i.e., the period between commencement and completion of repairs. If this period is extended due to the injured party’s fault (e.g., delayed repair order, untimely release, incomplete documentation), the reimbursement claim for the excess period lapses. For total loss, the relevant period is the time needed for replacement procurement—usually 10–14 calendar days are allowed, provided a prompt search can be substantiated. It is always essential to promptly notify the insurer of any delays.
