Hanford reader Garry Pierce is a very good customer of National Car Rental, with close to 100 rental days yearly. He has earned the highest tier in their Elite Isle Emerald Club, and his customer profile lists vehicle preferences, declining the rental company’s expensive and often unnecessary insurance coverage. “Not only do they provide excellent customer service, but all he has to do is to walk to the Elite Isle, find his car, drive to the check-out hut, show them his license, credit card and Emerald Club card, and that’s it,” Laura Pierce wrote in an e-mail at one in the morning, Thursday, Sept. 7, 2006.

It was a plea for help, from a reader who had tried everything possible to solve a potentially embarrassing and costly problem resulting from a serious mistake made by a National Car Rental employee in Las Vegas. I read it at 8 that morning.

You’ve got insurance!

Weeks earlier, using the National on-line reservation Web site, Laura reserved two vehicles to be picked up at the Las Vegas airport, one for her and her husband and the other for their daughter. “We were using Garry’s free car credits for one of the rentals, and with taxes, the entire bill should have come to under $100 but somehow, the gal at National’s counter, despite all the information in Garry’s preferences declining insurance, added every insurance possible! In the past, all he would do was to initial the contract, and as the preferences were initialed where instructed, he did not closely read the fine print in which this unnecessary and unwanted insurance was added. He just assumed it would be as it always was in the past,” Laura explained.

When the cars were returned to National, Laura and her husband were handed a bill that was over $400. “His employer permitted employees to use these points for discounted or free rentals, but this kind of a bill – which we would probably have to pay – would be an embarrassment,” she explained when we spoke later that morning.

Laura faxed me everything concerning these rentals, and indeed, it was clear that the National employee in Las Vegas had somehow failed to read the reservations or Garry’s preferences.

You signed, tough luck!

Prior to her e-mail, Laura phoned National’s Customer Service Center and spoke with “the most uncaring managers you could imagine. Their attitude was arrogant and completely unhelpful, repeating, “Your husband didn’t read the contract – pay the bill!”

In my opinion, this was not the way a loyal National customer should be treated, even if Garry didn’t closely read the rental agreement. After all, he assumed – based on prior experiences – that any contract form presented would be correct, and was always that way in the past. Legally, they had established a “course of dealing” and an oversight by a sloppy clerk should change nothing.

National needed to remove most of those charges, and I felt confident that once I reached the right person, that would indeed be the result.

Arriving at my office at about 9 that morning, I phoned National, which is based in Tulsa, Okla., and is part of the giant Vanguard Car Rental Group. With Alamo and National as their main brands, they rank third behind Avis and Hertz among U.S. car rental companies. In my experience, when you reach the right person, things happen – quickly.

Voice mail that worked

I was referred to Charles Pulley, director of corporate communications and was connected with his voicemail. “Hi there, my name is Dennis Beaver and I really need your help in resolving a reader’s problem,” I said. Leaving the rental contract numbers, I explained what had happened and asked him to look into it and call me back.

I next phoned Laura and told her that we were in contact, and I expected a call back, but when I could not say. No sooner had I hung up from her, when Mr. Pulley called. “We are researching this right now and someone will be back with you today,” he assured me.

Pass the Kleenex

At 11:45 that morning, Laura called me. “Mr. Beaver, National just phoned! They apologized and are removing all the incorrect charges. I was so worried and didn’t want my husband to be in a bad situation at work.” And then she began to cry.

“No one would listen to me at National. It just seemed so unfair, and I blamed myself in part,” she said, softly. “Nothing at all happened until you called!” she whispered, but I could hear her still crying.

“Laura, it’s OK now, and please don’t cry, because if you keep it up, I’m going to start to cry myself!” I said. It made her laugh.

And then, my other phone line rang. It was National. “Mr. Beaver, we found the mistake and have reversed all the improper charges,” a professional sounding voice said. “Please accept our apologies for the inconvenience to your reader.”

Apology accepted.

Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.

The post Rental car insurance contract blues appeared first on Dennis Beaver.

Last week we told you about Hanford veterinarian Dr. Lee Fausett and the flat tire he experienced with a car rented from Alamo at the Salt Lake city airport this past July. After accepting the Roadside Plus coverage at $5 a day – which included flat tire repair and replacement costs – he was billed for a flat encountered within minutes of driving off of Alamo’s lot.

The rental car had been driven 400 miles, yet PurCo, Alamo’s collection agency, wanted $135 to replace the tire, a day’s lost rental value and an administrative fee, or Dr. Fausett would face suit and damaged credit. A collector stated Alamo had dropped the Roadside Plus benefit “months earlier,” but sent Dr. Fausett rental contract forms which actually showed the coverage.

We phoned the CEO of Alamo/Enterprise, and in a matter of days, its lawyers looked into the situation, spoke to our reader and concluded he was indeed under the impression that flat tires were included with Roadside Plus. They dropped all further collection actions against him. That’s what I call doing the right thing.

I’m covered, right?

Regardless of why you’ve rented a car, if something happens to it – an auto accident, or it’s parked and someone plows into it – the rental company expects to be paid for repairs and, possibly, lost revenue for the vehicle being out of service. But who pays?

What about a tire that just goes flat – just like our Hanford reader – and has nothing to do with an auto accident, or driving the car over a curb accidentally?

If you are thinking, “I’m covered by my own auto insurance, and besides, my credit card has rental coverage, so I shouldn’t be out a cent,” sorry for the cold water we need to splash on you.

It is possible, even likely, to have all of that and still be out of pocket unless some very careful precautions are taken. So, let’s take a look at what each of these common sources of insurance coverage actually do provide for rentals in the U.S.

Credit cards aren’t all alike

Unless you have checked with your credit card company, never think all damages or your liability to others in a rental car are covered merely by booking the rental and paying for it with the card. While there are no doubt other very good cards, American Express has excellent basic coverage included with some of its cards, as well as reasonably priced premium rental coverage, which is an incredible bargain in terms of what it offers, in our opinion.

We were told by one of their claims agents that American Express will cover a flat tire, whether it is related to an auto accident or not. Basic Mastercard will only cover a flat or damaged tire as a result of an actual collision, one of their claims representatives stressed. That isn’t a small difference and should stand as a red flag about other Mastercard limitations. They aren’t alone.

Most card issuers require that the renter already have their own auto insurance, with comprehensive and collision coverage. Phone and have a rep explain rental insurance benefits and limitations. Are they acting as a primary or secondary insurer? When do they pay? Do you have to pay first? Politely insist upon a printout of rental benefits, and then read it.

Your own auto insurance

In general, most auto insurance policies will cover you driving a “substitute” vehicle, and that includes rental cars, for a limited period of time. Your deductible will also apply to the rental. But you are only going to have as much coverage when driving that nice, new $40,000 rental as you had on your own car.

So, let’s say you are insured by Farmers and need to rent a car, but all you have is public liability and property damage insurance, but no collision or comprehensive coverage on your 5-year-old car because you agent told you to save the money. That’s often a very bad idea, by the way, but makes agents look great as they appear to save their customers so much money.

Farmers will cover you as far as liability to others – if you are at fault – but will pay nothing for damage to the rental car, as you didn’t have that kind of coverage on your own vehicle.

Also, if you have a deductible on your car, it will carry right over to the rental, and you could be out of pocket that amount.

Rental company loss damage waiver

Finally, while it does add to the cost of a rental, buying the rental company’s own collision damage waiver can be the safest course to follow.

If today’s report has left you in doubt about what to do, then you get my point. There is no “one size fits all” answer.

Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.

The post Understanding insurance for rental cars appeared first on Dennis Beaver.

Today’s story will be of interest to anyone who rents a car.

Who is responsible for the expenses to an auto rental company resulting from a flat tire? The rental company itself? The credit card issuer if their card was used to pay for the rental? The renter’s own auto insurance? Or is the renter personally liable?

“It will cover both tire changing and replacement”

On July 15, Dr. Lee Fausett rented a Chevrolet Impala from Alamo Rent-A-Car at the Salt Lake City airport. The Hanford veterinarian was informed by the clerk that, in addition to other benefits, by taking the $5 a day Roadside Plus option, “For a flat tire, we cover repair and replacement charges.”

“I knew my own Triple A would change a tire, but nothing more. It was the tire repair/replacement aspect of Roadside Plus which was the selling point, and so I purchased it.”

The new Chevrolet Impala he was given had only been driven 400 miles, as You and the Law would learn.

“After about 6 to 8 miles, I noticed a very slight vibration, immediately pulled over, got out of the car, and saw that right rear tire was very low on air, but was not completely flat. We did not strike anything, felt no bumps, nothing at all abnormal. The distance from first feeling the vibration to pulling over was about one-half a mile. No one else even noticed the vibration.”

“We phoned Alamo Roadside Assistance, waited on hold, but as we were on a tight schedule, finally changed the tire ourselves. Examining it carefully, we found no penetrating objects, no bubbles or bulges present, no cracks in the tread or sidewall, no separation. There was no way to evaluate the stem area. In short, we could not find evidence for the cause of the tire losing air. It could very well have been in that condition when we first pulled out of the Alamo lot.”

They drove back to the airport, were given a different car and returned it July 18.

“Hello – you owe us for a new tire and a lot more”

A completely unexpected reminder of that flat tire incident came in the mail one month later. It was a demand letter from Amy Davis of PurCo Fleet Services in Spanish Fork, Utah.

PurCo is a collection agency for car rental companies, “eliminating uncollectible damages on everything from a rock chip on a windshield to a totaled vehicle,” as their website states. The Better Business Bureau gives it a C- rating, which is not good, and a Google search is extremely interesting. Not only do their tactics rub a lot of people the wrong way, but they have been sued by state agencies for violating consumer protection laws. Their collector wanted my Hanford reader to pay:

$135 for a new tire

$25 a day’s loss of use of the rental while the tire was being changed

A $50 administrative fee

Nonsense answers from a collector

Upon receiving Dr. Fausett’s letter, I first phoned the CEO of Alamo/Enterprise, leaving a voicemail message. Then I called PurCo and spoke with collector Sandy Pike, who had threatened in writing to both sue and damage my reader’s credit.

“What about the Roadside Plus he purchased?” I asked her.

“Oh, the contract form we gave him is an old one – we dropped that coverage last November,” she replied.

“Oh, really, how nice of you; there’s nothing like changing the contract afterwards,” I thought.

“Look, this was a new car with only 400 miles on the tire. Tires have guarantees, and also, the fact that he didn’t hit anything sure seems as if the tire was going bad when he picked up the car. Did anyone submit a warranty claim on the tire?” I asked.

“We don’t have to,” she said. “The flat happened while he was driving the car. He is responsible.”

“How do you explain a day out of service? It only takes a few minutes to change a tire,” I replied.

“We just do!” she retorted.

If I had asked her, “How can you prove any down time at all? You have to show this was the last car on the lot and could not be rented,” I would have gotten some nonsense response, so I didn’t waste the time. The fact is that she probably cannot prove any lost rental time or profit.

While on the phone with PurCo, attorney Mark Litow of Alamo/Enterprise was on our other line. I immediately took his call, and now was speaking with a person who sounded extremely sincere. By the tone of his voice – and sense of humor – I was certain we would have a fair resolution – and quick.

Next time: the outcome and how to protect yourself when renting a car.

Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.

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