Rental cars get damaged, and when they do, someone has to pay: an insurance company, the renter or the car rental company. While the great majority of damage claims are processed without incident, any car rental company will share the uneasy fact that some customers who damage vehicles will try everything in the book to get out of the claim. Car rental companies hold the line where they can, but some claims, you just have to eat.

That’s why it chafes car rental operators to see those damage-claims-gone-bad articles getting so much attention in the media. Heck, when the system goes right it isn’t news.

But the reverberations from those articles seem to have intensified. I can’t tell you if this signifies a problem in the industry, if I’m just more on the lookout for them, if the internet has accelerated the exposure of bad claims or if more consumer rights watchdogs are looking for them. That is a question that is virtually impossible to answer. But if it ends up in the media, it is therefore a problem. And stories like this damage claims investigation in Vancouver play into every consumer’s fears.

So when Sharky Laguana, owner of San Francisco-based Bandago Van Rentals, came to me with an idea to institute a so-called Renter’s Damage Bill of Rights, I listened.

My first reaction was this: It is a privilege to rent a car, and the renter must abide by the rules in the contract. Why would a car rental company give the customer an inch on damage claims knowing full well some will take a mile? Why offer the impression that the industry has a problem to begin with?

As a renter of vans to rock bands, Laguana processes an inordinate number of damage claims, and they often turn into frustration based not on actual policies but on an alarming level of vitriol and distrust directed toward car rental companies. “What strikes me, over and over, is how little faith consumers and insurance carriers have in our integrity,” he wrote. “We are always, in their eyes, guilty until proven innocent.”

Laguana suggests that the industry adopt a universal best practice guideline for processing damage claims using input from all stakeholders: car rental operators, insurance carriers and consumers. Whatever the guideline is called, it would be a simple “plain English” statement to show consumers what to expect.

Laguana is not in this to acquiesce. He feels that an established set of guidelines will lessen arguments with clients and carriers, saving both time and money for all involved. “All this bad faith is emotionally draining,” he wrote. “I like being the good guy. I think everyone else does too.”

And he thinks the issue of damage claims has wider ramifications.

“My fear is that if we wait for consumers to resolve these issues we will once again be negotiating from a position of weakness, and wind up with yet another set of one-sided laws and regulations that don't even attempt to take the operator’s perspective into account,” he wrote.

I brought this to the attention of Leslie Pujo of LaPlaca Pujo PC, and she concurs that the industry could put itself at a disadvantage if it does not take the lead to address serious consumer concerns. Both Pujo and Laguana cite state legislation governing CDW, loss-of-use and GPS tracking that resulted in legislative (over)reaction regarding abusive actions by single operators.

Pujo points out that many industries self-regulate successfully, citing the film industry through MPAA and the guidelines put forth by ISO and ANSI for general and technical business standards.

Pujo also offers caution on self-regulation: “The key for successful self-regulation — it must be meaningful and offer serious solutions to issues encountered by the industry,” she wrote. “… Otherwise, the industry runs the risk of being accused of offering ‘window-dressing’ or fluff and ultimately subjected to regulations imposed by legislators who do not understand the impact on operations.”

If a Renter’s Bill of Rights has any legs, the devil is in the details, of course. Getting car rental companies on the same page on anything is like herding cats. And then, would the guidelines get any teeth? Would renters have an opportunity to air grievances in front of a non-partisan committee? How would this be governed, and who would pay for it?

These questions would be answered further down the line. For now, it’s just an idea looking for a forum. Let the conversation begin.

Originally posted on Business Fleet


Chris Brown
Chris Brown

Digital Editor of Automotive Fleet, Fleet Forward, Auto Rental News

As editor of Automotive Fleet (digital), Auto Rental News, Fleet Forward, and Business Fleet, Chris Brown covers all aspects of fleets, transportation, and mobility.

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As editor of Automotive Fleet (digital), Auto Rental News, Fleet Forward, and Business Fleet, Chris Brown covers all aspects of fleets, transportation, and mobility.

View Bio