Forced to buy car rental insurance that didn’t cover her

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By Christopher Elliott

From time to time, a case comes across my desk that gets me turned upside-down, because it doesn’t make sense on so many levels. Julie Yu’s dispute with Dollar is one of them.

A few weeks ago, I shared a problem of one reader’s mandatory car rental insurance charge in Mexico. Basically, her vehicle ended up costing a lot more than she thought it would, even though she’d purchased insurance through a third party.

Turns out this happens often. But Yu experienced the same problem — with a dark twist.

Like other renters, Yu thought she’d done her homework. She researched the cheapest car rental rate in Cabo, which was through Dollar. She called the reservation number and confirmed the Mexican liability insurance requirements.

“I was assured full out-of-pocket price would be $118, with $12-per-day insurance,” she says.

A tale of surprise charges

But when she arrived, an agent told her the reservations agent was mistaken. The per-day insurance rate would be $25.

“What about the quote?” asked Yu.

“They always get the rate wrong,” said the rental employee.

The Dollar agent added: take it or leave it. Yu reluctantly accepted the car and the mandatory $25-per-day insurance.

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And here’s where things get a little funny.

When Yu returned the car, she again mentioned the mandatory insurance, which was more than twice the rate she’d been originally given. Apparently, this didn’t sit well with the agent who was handling her return.

The agent said there was a scratch on the final inspection and charged over $300 for damages and loss of use.

We disputed this since we knew nothing was damaged during our rental period and there were multiple scratches on the bumper when we started the rental.

The agent then showed us a small, thin curvilinear scratch on the bottom of the left corner of the bumper. Again, they forced me to sign for damages or we would have missed our flight.

Retributive tactics with Dollar rental insurance

Twice during her rental, Yu felt as if Dollar had her over a barrel. Once when she’d been surprised by a higher insurance rate, and again when she returned her vehicle and was told to sign the damage claim … or else.

Note to anyone reading this who may be thinking of renting a car in Mexico: No one ever has you trapped, even when you’re south of the border. If you’re at the airport, there are other car rental companies to get a car from. You can walk away. (Related: Dollar didn’t have my rental car — but it still charged me $82!)

But the retributive damage claim — that’s a new one.

Yu complained to Dollar and received the following response:

I have contacted the location on your behalf, and they have responded accordingly in regards to your rental charges.

They have confirmed that the basic third party liability insurance (PLI) was charged at 209.85 pesos per day (converted from $15.00 per day). Their liability insurance ranges from $12.00 to $20.00 per day, depending on the type of vehicle rented.

I apologize if the coverage requirements were not better explained by our phone agent. I have forwarded your comments to upper management to ensure corrective training is provided internally. This information is also provided on our website, as well as during the online reservation process, under the section for local policies.

With regards to the damage, please understand that Customer Service acts only as an intermediary, and unfortunately, we are not in a position to substantiate or refute any damage claim between you and the location. If you would like more information regarding this claim, or to further pursue this matter, I must ask you to contact the location directly. I have provided contact details below that can be used.

In other words: Sorry, we can’t really help you. (Related: Are car rental companies forcing you to buy insurance you don’t need?)

I’m not surprised that Dollar changes its “mandatory” insurance requirements on the fly, but I find it troubling that it would add a damage claim to customers who push back. (Here’s how to find the best travel insurance.)

But a bigger question is: Why force someone to buy insurance if it doesn’t cover you?

I can’t jump in and mediate this case yet, since Yu has decided to dispute this with her credit card company. I think she stands an excellent chance of getting not only part of her insurance refunded, but making the damage claim go away.

Should Dollar's mandatory insurance have covered the damage to its car?

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Christopher Elliott

Christopher Elliott is the founder of Elliott Advocacy, a 501(c)(3) nonprofit organization that empowers consumers to solve their problems and helps those who can't. He's the author of numerous books on consumer advocacy and writes three nationally syndicated columns. He also publishes the Elliott Report, a news site for consumers, and Elliott Confidential, a critically acclaimed newsletter about customer service. If you have a consumer problem you can't solve, contact him directly through his advocacy website. You can also follow him on X, Facebook, and LinkedIn, or sign up for his daily newsletter.

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