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FAQ on Rental Cars

Whether on business or vacation, you may need to rent a car for at least part of your trip. Here are your basic rights as a renter.

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Whether on business or vacation, you may need to rent a car for at least part of your trip. This section outlines some of your basic rights as a renter. Most laws related to rental cars were enacted by state legislatures or derived from court cases interpreting those state laws.

Do I have any recourse if the rental car company doesn't provide me with the type of car I reserved?

If you have guaranteed payment and the company does not have the car you reserved available for you, the company must do everything it can to find you a different car from its fleet. Theoretically, the company must find you a car from another rental car company if it has no suitable substitute, but in practice this rarely happens. If the alternate car found for you is more expensive, you should not have to pay the difference.

If you haven't put down a deposit or guarantee, the company is still required to have a car available. But rental car companies often overbook to cover no-shows, which means that the class of car you reserved won't be available. The rental car company will usually provide you with a larger, more expensive car and tell you it is giving you a free upgrade. Most renters are happy to accept the upgrade to a larger, more expensive car. If you accept a smaller, cheaper car than the one you reserved, the rental company is obliged to charge you the lower rate. If you refuse to accept a substitute car, you will probably have difficulty getting compensation afterward -- you had a duty to reduce your damages by accepting a car that was a reasonable substitute for the car you reserved.

What if I have reserved a car and the rental car company fails to provide any car at all?

A company's overbooking may mean that no cars are available when you arrive. Your only real alternatives may be to find a substitute rental car at a different company or to take a taxi and seek reimbursement from the original car rental company. In addition, the rental car company may offer you future discounts.

Can a rental car company charge a penalty if I don't show up or if I cancel my reservation?

Nearly all rental car companies charge penalties for four-wheel drives, minivans, convertibles and other specialty rentals if you fail to cancel a reservation in advance or are a no-show. Some companies are testing similar policies on their standard rental cars.

My son was told he couldn't rent a car because he's only 20. Is that legal?

Yes. Most major companies refuse to rent a car to someone who is under 21 or in some cases 25, unless that person is an employee using a corporate account or is military personnel traveling on orders. Companies that do rent to people as young as 21 usually charge an additional fee for drivers between 21 and 24.

This discrimination is not illegal. Rental car companies can do business with whomever they choose, as long as they do not discriminate based on race, religion, national origin, sex or other categories protected under civil rights laws.

Do I need a credit card to rent a car?

Most rental car companies require a major credit card (or a debit card resembling a credit card) as a way to secure a deposit from you at the time of rental, although you can use the card or cash when you actually pay for the car. The company will check your credit limit or account balance and freeze an amount slightly greater than your estimated rental charges against your card, meaning that this amount is not available for you to charge or withdraw. This freeze can last for several days after you return the car, even once the actual amount is charged or withdrawn or you pay with cash.

If you don't have a credit or debit card, you can get a prepaid voucher through your travel agent by paying for the rental car first at the travel agency and bringing the voucher to the rental counter. The voucher may not cover taxes, surcharges, additional drivers, upgrades and other charges, so be sure to find out exactly what is included with the voucher before you pick up the car. Many companies require you to present a credit or debit card or provide some other form of deposit even if you are using a voucher, so call ahead to find out.

Can a rental car company screen me based on my driving record?

Yes, and many companies now screen drivers when they rent in vacation-popular destinations such as Arizona, California, Florida, Nevada, New York, Virginia and Washington, D.C. Sales agents conduct screening checks by entering your license number into a computer program that calls up your driver's record as reported by your state department of motor vehicles. If your record doesn't meet the screening criteria of the rental company, the agent will refuse to rent you a car.

Instead of screening you, some rental car companies may require you to sign a statement that you have an acceptable driving record. This shifts the responsibility for providing accurate information away from the company and to you. If you have an accident and signed a statement that turns out to be incorrect, the rental car company could use it against you by claiming that you acted in violation of the rental agreement.

Rental Car Screening Standards
Generally, a rental car company that screens drivers will deny you a vehicle if, during the past 36-month period, you
  • were caught driving with a suspended or invalid license
  • had one instance of drunk driving, hit-and-run, driving a stolen car or other serious offense
  • had three moving violations, or
  • were at fault in two accidents.

The standards adopted by each rental car company vary and are subject to change, so you need to inquire about the specific rental screening standards of any company you are considering using.

If your driving record is questionable, do the following:

  • Call your motor vehicle department to see if your state makes driver records available. If it doesn't, then relax and don't worry about being screened.

  • If your state makes driver records available, when you call to reserve a rental car, ask if the company screens driving records and whether it maintains a nationwide blacklist.

  • Get your driver record evaluated by a screening company. Several companies evaluate driving records to determine in advance whether drivers will be disqualified from renting. TML Information Services operates a program for drivers from states that make driver record data available online. For around $11 you can get an evaluation of your driving record against the criteria for screening risky drivers used by six major rental car companies. TML has a website at http://www.tml.com. The company can also be reached by phone at 800-743-7891.

  • If you don't want to pay for an evaluation, get a copy of your driving record from the motor vehicle agency in your state (allow plenty of time), obtain the screening criteria of the rental car companies you are considering and make an evaluation on your own.

  • If you are traveling for business, rent from a company that has a liability agreement with your employer-the screening company may overlook items that would otherwise disqualify you.

How do rental car companies establish rental rates?

Car rental fees are set by each company and vary depending on the location of the rental office, time period the car will be rented, season, car model, special promotions or vacation packages and your eligibility for discounts. In addition, because many rental car companies have franchises, the rates and policies of the central office may vary substantially from those of a local office. There is nothing illegal about these multiple prices, and there is nothing to stop you from asking about special fares when you rent or for a reduction after the rental, if you learn that a better rate was available but was not offered to you. Although the company is not obligated to offer you the lower price, it may do so to maintain good customer relations.

Can the rental car company tack on special fees?

Yes, but the company must tell you about the fees before you rent. Here are the most common fees you're likely to encounter:
  • Mileage charges. While many companies offer unlimited mileage, mileage charge policies change frequently, and you should ask each time you rent.
  • Fees for renting at an airport. Renting at an airport may be more expensive than renting at an urban or suburban location because airports and local governments often add surcharges and taxes to rental car rates.
  • Additional driver fees. Most rental car companies charge extra for anyone who drives the car other than the person who signs the rental agreement. Often, additional driver charges are waived for your spouse, immediate family member or business associate.
  • Young driver fees. As indicated above, many rental car companies add a daily surcharge for any driver aged 21 to 24.
  • Child safety seat fees. All states require children under a certain age to be placed in child car seats. If you don't bring your own seat, you will be required to rent one, usually at a cost of $3-$5 per day or $25 per week. You may be charged more for one-way rentals, and you may be required to make an extra deposit for the seat if you are paying cash for the car rental.
  • Vehicle drop-off fees. Many rental car companies charge higher rates for dropping off a car at a location other than where you rented, unless the drop-off location is within the same metropolitan area as where you picked up the vehicle. Charges for picking up the car in one city and dropping it off in another can be as high as $1,000.
  • Refueling charges. Most companies require you to return the rental car with a full tank of gas. If you don't, you'll be forced to pay the company's inflated price per gallon, as much as $3 for on-site fill up.

Do I have to take the rental car insurance offered to me?

No, and chances are you shouldn't. Each year, travelers in the U.S. spend more than $1 billion on rental car insurance, much of it unneeded or unwanted. California, Texas, and Indiana require rental car companies to inform you that the rental car insurance may duplicate your personal automobile policy. But still, rental car insurance options are complex, confusing and rife with potential rip-offs.

When faced with a rental car insurance policy, adopt this basic strategy:

  • determine what coverage you already have through your automobile insurance or credit cards.
  • find out what insurance options the rental car company offers, and
  • don't fall prey to hardball sales tactics -- buy only what you need.

What is loss damage waiver? Is it insurance?

Loss damage waiver, or LDW (also known as collision damage waiver, or CDW), has gotten substantial press in recent years due primarily to its high cost and to complaints by consumers of pressure from rental car companies to purchase unnecessary LDW.

Rental car companies claim that they are not selling insurance, and that LDW is simply a waiver of the company's right to collect from you if the rental car is damaged or stolen while under your control. In most rental contracts, the rental company shifts all responsibility for collision damage or other loss to you; the effect of purchasing LDW is to shift responsibility back to the rental car company. But three aspects of LDW make its value suspect:

  • the high pressure or deceptive sales tactics used to sell LDW
  • the high price for LDW -- especially when you may already be protected by your own insurance or credit card, and
  • the number of exclusions (loopholes) in LDW coverage that allow the company to charge you even if you purchased LDW to protect yourself.

Should I purchase loss damage waiver?

Purchasing loss damage waiver (LDW) may be a prudent choice for you if:
  • You're in a foreign country and your auto insurance or credit card coverage does not include foreign rentals.
  • You have no personal car insurance and do not want to rely on credit card coverage alone.
  • Your personal auto insurance is insufficient to cover a rental vehicle.
  • You can't afford to carry any credit charges until the credit card company reimburses you.
  • Your rental car isn't covered under your insurance or your credit card coverage (this may be the case if you rent an antique or exotic car).

What should I know before I rent a car in a foreign country?

Although the laws governing car rentals differ in every country, here are some general rules.

First, most countries will accept your valid state driver's license with another form of photo ID. Some countries may also require an International Driver's Permit (available through AAA offices). Check with an AAA travel office before you travel. You don't need to take a test to get an International Driver's Permit; all it does is explain (in a number of languages) the type of license you have, any limitations that apply and when it will expire.

Second, your personal automobile insurance policy may have restrictions or limitations on driving in foreign countries. Check your coverage, including the terms of your credit card policy, before you rent in a foreign country.

Third, in some countries, the police will take your license if you are involved in an accident or stopped for a moving violation, and will not return it until you have paid any applicable fine. Get receipts for all payments you make, and report any mistreatment or apparent scams to the American embassy or consulate in that country.

Fourth, certain European countries track traffic violations with street cameras that photograph cars at intersections. The police trace the drivers using the license plate number of the car and request payment from the rental car company for the ticket. The rental car company is within its rights to collect the fine from you, even if the company is informed of the violation after you have returned and paid for the car.

For More Information About Rental Cars
  • A Consumer's Guide to Renting a Car, Alamo Rental Car, Office of Public Affairs, P.O. Box 22776, Fort Lauderdale, FL 33335, 800-445-5664.
  • Budget Rent-A-Car Rent Smart Brochure, P.O. Box 23903, Milwaukee, WI 53223, 800-736-8762
If you will be driving in Europe, the following publications have useful information:
  • Autorental Europe, by Bill Meier (Lansing Publications, Box 1887, Pleasanton, CA 94566), discusses the rental process and provides detailed specifications of European car models.
  • Exploring Europe by Car, by Patricia and Robert Foulke (Globe Pequot, Old Saybrook, CT, 800-243-0495), focuses on driving in Europe, with details on driving conditions and rules in different countries.
  • Motoeuropa, by Eric Bredesen (Seren Publishing), includes country-by-country specifics about renting cars and driving in Europe.

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Phone: 360 794-4886 * 800 433-5945 Fax: 360 794-0311
www.vacationshop.com * Travel@Vacationshop.com