Car Insurance Endorsements Explained

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You’re flipping through your car insurance policy documents and you come across a section labeled “Endorsements.” What does this mean? And is it a problem?

No! The endorsements listed in your policy are intended to personalize your car insurance to match your specific needs.

Read on to learn more about car insurance endorsements and what they mean for you.

What are Car Insurance Endorsements?

An endorsement on your car insurance, also called a rider, is a statement that modifies your policy by changing, adding or deleting coverage or terms.

Think of it this way: Most car insurance policies are pretty standard. You can change your coverage limits, of course, but overall, the language describing what’s covered is the same.

An endorsement personalizes your insurance for your specific situation. It may:

  • Expand the scope of your coverage
  • Limit or restrict your coverage
  • Change definitions or other language in your original policy
  • Clarify or specify how your coverage applies to certain situations
  • Add or remove specific people as insureds

Extra Coverages Available on Car Insurance Policies

Some car insurance endorsements give you extra coverage, such as:

Rental Reimbursement Coverage Endorsement: When your vehicle’s in the shop for repairs after an accident, this endorsement adds coverage for the cost of a rental car for a specified time. This endorsement does usually add to the cost of your insurance policy, so only add it if you really need that rental car to get around. If you have a second vehicle in the garage that’s not your daily driver, for instance, you may not need the rental reimbursement endorsement.

Disappearing (or Diminishing) Deductible Endorsement: Every year that you don’t file a car insurance claim, you earn a credit on your deductible (usually $50 or $100). That means when you do have to file a collision or comprehensive claim, you may pay a discounted deductible, or none at all. There’s typically a cost for this endorsement, however, so you’ll need to figure out if it’s worth it.

Towing/Roadside Assistance Endorsement: This is a common endorsement that adds coverage for roadside assistance and/or towing.

Modified Car Endorsement: Have you paid thousands for custom car modifications or a special paint job? Then you need an auto insurance endorsement that covers those modifications, so you can have them repaired/redone if your vehicle gets into an accident. It’s not just for cosmetic or performance mods, either. If your vehicle has accessibility modifications, you need to cover those too.

Classic Car Insurance Endorsements: If you own a classic, antique or collectible vehicle, you’ll need a special insurance policy to make sure its value is fully protected. That policy may include some classic car endorsements, depending on the condition of the car and how you use it.

For example, a Vehicle Under Construction endorsement can cover a car that’s being actively restored (just tinkering with it every now and then doesn’t count.) An Agreed Value endorsement means that you and the insurance company have come to an agreement on exactly how much your classic car is worth. And if you take your car to shows and events, then you’ll want a special endorsement to protect it while you’re on the road.

Pet Injury Coverage Endorsement: Some car insurance policies include an endorsement that offers coverage in case your pet is hurt or killed in an accident. If your cat or dog is injured, this coverage can help pay for the vet bills, and a monetary death benefit may apply as well.

Car Insurance Endorsements for New or Financed Cars

If you’re driving a new (or new-to-you) vehicle, you may need one of these endorsements:

Gap Insurance Endorsement: Also called “guaranteed auto protection” insurance, gap insurance is coverage that pays off your loan in case your car is totaled in an accident or stolen. If you’re financing or leasing a car, gap insurance may be required. Pro tip: Most car dealerships will add gap insurance as an add-on at the time of sale, but you can usually get it cheaper through your insurance company.

New Car Replacement Endorsement: This coverage pays to replace your new vehicle with another new vehicle of the same make and model, should yours get totaled soon after you buy it.

Car Insurance Endorsements for Rideshare or Delivery Drivers

If you’re thinking about driving for Uber, Lyft or a package or food delivery service, you’ll need to check your car insurance. A personal car insurance policy typically won’t cover a vehicle while it’s being used for business. And while rideshare and delivery companies do provide their drivers with some insurance, it doesn’t fully protect you.

That’s when a special endorsement for rideshare or delivery comes in handy. These auto insurance endorsements can protect you during gaps in coverage, such as the times when you’re actively working, but waiting for a ride request or delivery order to come in. A ridesharing/delivery endorsement also may cover some of the deductible for the company insurance policy.

Learn more about car insurance for rideshare drivers.

Other Common Car Insurance Endorsements

We’ve covered most of the common car insurance endorsements you might find in your policy, but here are a few more:

Changing the Named Insureds: Let’s say you’re separating from your spouse, and he or she has moved out. You don’t want to keep paying for their car insurance, so you might call your insurance policy and ask for your former partner to be removed. The insurer might then issue a new endorsement for the remaining length of your policy that specifies only you as the insured driver.

Named Driver Exclusion Endorsement: This endorsement excludes certain drivers in the  household from your comprehensive and collision coverage. This can help save money — if you have a child at college, for example — but it means that you’ll have zero coverage for the vehicle if the excluded household member drives it for any reason.

Miscellaneous Vehicle Endorsement: This car insurance endorsement can add other types of vehicles to your policy, such as motorcycles, snowmobiles, dune buggies, RVs, mopeds, even golf carts.

Non-Owned Vehicle Endorsement: Intended for business owners, this endorsement offers liability coverage when an employee is driving their personal vehicle for business purposes.

OEM (Original Equipment Manufacturer) Endorsement: An OEM endorsement states that only parts made by your vehicle’s manufacturer (not cheaper aftermarket parts) may be used to repair your vehicle.

If you need an endorsement for your car insurance policy, just contact your insurer. But before you do that, make sure you’re not paying too much for insurance! customers save an average of $720 a year on their car insurance just by comparing quotes and choosing a lower-priced option.

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