Many factors determine which party pays for damages after a rental car crash. Car accidents are inherently stressful for victims. When a rental car is involved, a whole new layer of concerns is raised. Who pays damages for a rental car accident can be influenced by:
- Level of insurance coverage: This includes a driver’s personal auto insurance and the rental agency’s supplemental coverage
- Other driver’s insurance: The at-fault driver’s auto insurance is the most likely source of compensation for rental car accident victims
- Cause of the accident: Driver negligence or vehicle malfunctions can influence who pays damages
Insurance coverage determines the payout that may be available when someone is injured in a rental car accident.
Victim’s Personal Auto Insurance
Drivers with comprehensive coverage (including liability, medical, and personal effects) may not need the rental agency’s additional insurance.
And at-fault driver’s private liability insurance only covers damages to other victims. It typically doesn’t cover damage to the rental vehicle.
The Other Driver’s Auto Insurance
The at-fault driver’s insurance will usually pay for injuries, medical bills, and any other compensation due.
Purchasing Rental Car Insurance
A driver’s private insurance coverage might overlap with the rental agency’s. Some of the most important types of rental car insurance include:
- Collision Damage Waiver: Also known as the loss damage waiver, this waiver ensures the renter will not be held financially responsible if the car is stolen or damaged. People considering only one form of rental car coverage would do well to purchase a loss damage waiver provided the deductible is reasonable.
- Supplemental Liability Insurance: Supplemental liability coverage protects an at-fault driver paying for damage to another person’s property. The money-savvy option is to add “umbrella liability” to one’s own home or auto insurance policy.
- Personal Effects Coverage: This covers theft.
- Personal Accident Insurance: This covers a driver’s accident injuries. Consumer advocacy groups have advised against purchasing personal accident insurance because most people have overlapping coverage from their auto, home, or life insurance.
Who Is at Fault for Injuries Caused by Defective Rental Cars?
Defective rental cars are common due to constant back-to-back use by multiple drivers. When someone is injured because of a defective rental car, fault can be directed at multiple parties.
Like other injuries in a car accident, a rental car accident case can include multiple defendants.
There are federal regulations for vehicle maintenance. The rental car agency can be held liable for injuries if regulations were ignored.
Defective parts may be caused by a vehicle or parts manufacturer. Manufacturers can be held liable when their negligence causes a crash. Rental car companies can be held liable if they ignore product recalls and continue to place their vehicles in service, however.
The Graves Act of 2005: Rental Agencies Aren’t “Vicariously Responsible”
For a time in the 1980s and ’90s, there were multiple lawsuits against rental agencies. Some deemed these frivolous and criticized the sizes of the settlements. In 2005, legislation passed that removed responsibility from the rental agency in all but the most demonstrable cases of negligence.
For people injured in rental car accidents, it can be a long road toward compensation for injuries, pain, medical bills, and lost work. An attorney can explain the labyrinth of paperwork, waivers, and legal proceedings so victims can spend their time healing and resting.