How to win the car rental claim game

Tim Carpenter thought he had done everything he could to avoid a frivolous damage claim on his rental minvan.

He took pictures of his vehicle before he picked it up and after he returned it. He noted every pre-existing scratch and dent in the paperwork.

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But he thought wrong.

An Alamo representative at Orlando International Airport informed him that “none of that mattered” when he brought the minivan back and that his vehicle, which had a small scratch on the rear bumper, would be processed by the company’s claims department.

“Three weeks later a series of claim letters started arriving in the mail, demanding payment of over $750,” says Carpenter, who works for a federal agency in Oklahoma City. “When I questioned the damage amount, based on the amount of damage that was noted, I was told that the entire rear bumper had to be replaced. And there was ‘loss of use’ associated with that. I asked for documentation of the repair, but was told that was ‘company property’.”

Carpenter’s story is hardly unique. Try as hard as motorists might, more of them are getting dinged by the dreaded car rental damage scheme. Although there are no reliable statistics on the number of these claims, a recent reader poll found that just over half of respondents believe car rental companies are pursuing every claim, no matter how small, with greater fervor. An almost equal number say the claim game is being played the same as it always has been.

Alamo eventually dropped its claim, but only after Carpenter forwarded his photos to the company, along with an email promising he would file a complaint with the insurance commissioners in Florida and Oklahoma alleging insurance fraud. Alamo also apologized for the incident and sent him a free coupon for a weekend rental after he posted his story on my site.

I think it’s important to acknowledge the car rental industry’s side of this issue. When a car, truck or minivan is damaged, the company has every right to ask the customer or its insurance company to pay for the damages. If you didn’t buy the optional insurance from the rental company, and you harmed the vehicle, you need to make things right.

But customers argue that many of the damages for which they’re being dinged are minor – tiny chips, dents or scratches that, on any other car would be considered normal wear and tear. They’re also turned off by what they see as a racket to sell optional (and to the car rental companies, highly lucrative) insurance coverage. What’s more, they regard the “no claim left behind” philosophy as nothing more than an effort to profit from inevitable damage that comes with using a car – not unlike a hotel charging its guests for wearing out a carpet or burning out light bulbs.

I can certainly see both sides of this argument. If you damage a rental car, you should certainly pay up. But going after motorists for little scratches and adding hefty – and highly theoretical – “loss of use” surcharges, crosses a line. There are ways to push back, though.

Take video of the vehicle – before and after. Many phones now have the ability to take a high-definition video with the flip of a button. This is the time to use it. (If your phone can’t record videos, then at least take picture.) Liz Brown credits the images of her SUV rented in Honolulu for saving her from an expensive damage claim. A rental associate had “forgotten” to record pre-existing damage to a bumper on the paperwork, and her pictures made the claim go away — eventually. “The car was already a piece of junk,” she says. “The damage claim was a waste of time and energy.”

Get the “all clear” when you return the car. Give yourself a few extra minutes when you return your wheels. Ask an associate to inspect the car and ask for a sign-off in writing. “I always wait for the on-site contract closeout,” says Steve McEvoy, a consultant based in Little Falls, NJ, who rents dozens of cars a year. With written proof that the vehicle was returned in satisfactory condition, making a claim is far more difficult than if you simply slip the keys in a drop box.

Ask for documentation. A car rental company needs to substantiate any damage to the vehicle. That includes time-stamped photos that show the damage to your car the day you returned it, and repair invoices that note the model, make and license plate. Ro Spinelli, a researcher and occasional car renter, looks for other signs that the car rental company is being honest, such as a pre-repair damage estimate. “It may be eye-opening to see what other appraisals are,” she says. I have yet to see an appraisal among the claim documents, unfortunately.

Discard the “loss of use”. One real gotcha during this process is “loss of use” since it is almost never based in reality. Rather, it’s a theoretical number that assumes the car would have been rented while it was being repaired. And that’s not necessarily a valid assumption. In order for such a claim to be on the up-and-up, a car rental company would have to prove the vehicle would have been rented while it was being repaired, which can be exceedingly difficult.

Get the authorities involved. A polite but firm response to the car rental company’s claims department, with copies to the insurance commissioner in the state in which you rented the car, sends a clear message: If you don’t drop this frivolous claim, I’ll appeal my case to a higher authority. That’s what Nathan Smalley did when he was asked to pay $870 for damage neither he nor the car rental company associate could see when he returned his Enterprise vehicle in Arizona. “The pictures essentially showed nothing,” he says. “Absolutely nothing.” In his correspondence with the company, he disputed the claim, threatened to contact a lawyer, and copied the state’s insurance commissioner. That seemed to work. Enterprise dropped its claim.

By keeping meticulous records, requesting a car rental company’s repair paperwork, focusing on the actual damages and notifying the authorities when necessary, you can ensure you’ll only have to pay for what you wrecked.

A word of warning to anyone considering using these strategies to avoid paying for honest damages: If you abuse these tips, you’re no better than the car rental companies who are trying to make money from normal wear and tear. For what it’s worth, I think most people who rent a car and damage it want to do the right thing.

The bottom line is that no one – not the car rental company, not you – should be able to profit from a fender-bender.

(Photo: neop orcupine/Flickr Creative Commons)

5 thoughts on “How to win the car rental claim game

  1. I am in the middle of a fight with the Budget Franchise at the Harrisburg Airport over a damage claim of $500. They claim they showed me aa inspection form prior to my rental showing no damage and the car was damaged upon return. They did NOT show me this form and I have not seen it at other Budget facilties. They have turned the claim over to a collection agency! We did not damage the car, so watch out for Budget at Harrisburg Airport!!

  2. I wish I’d read this before a recent trip to Chicago. I rented from Enterprise. The woman rushed me through the “inspection” but more significantly, the car was covered in water drops – there was no way to see the small dent that they are now trying to get me for. NEVER ACCEPT A WET CAR! I was a customer of theirs for the past 15 years – never again and from now on, will take photos before and after. What a pain to avoid their thievery.

  3. I wish I’d read this before a recent trip to Chicago. I rented from Enterprise. The woman rushed me through the “inspection” but more significantly, the car was covered in water drops – there was no way to see the small dent that they are now trying to get me for. NEVER ACCEPT A WET CAR! I was a customer of theirs for the past 15 years – never again -and from now on, will take photos before and after. What a pain to avoid their thievery.

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