I had insurance for this Avis rental. How can I still owe $8,000?

Just after he rents a minivan from Avis, Michael Thomas has an accident. He thinks he’s covered by rental insurance through his credit card. Turns out, things are a lot more complicated.


I rented a Dodge Caravan from Avis. Twenty-nine minutes later I had a single-car accident. The next morning I stopped at the Avis counter, filled out the accident report, gave them all the information about where the vehicle was towed and the name of the tow company.

At the same time, I called American Express insurance, which I use with my credit card, and they eventually settled the damage for $8,594 for damages and towing. All appeared good then.

About a week ago, I got a letter telling me that I owed another roughly $7,061 for the damages. In addition, they have already charged over $1,100 to my credit card for the rental, which I have disputed twice.

They said the contract allows them to sell the car in its damaged condition at their sole discretion and any additional is owed by me. Looking at the terms and conditions, it is clear that it is at their sole discretion to do that. Can you help me? — Michael Thomas, Dawsonville, Ga.


After using it for half a century, a few years ago Avis dropped its tagline “We try harder.”

But it this case they seem to be trying pretty hard — to collect from you — based on some often overlooked provisions in the rental car agreement that we all sign when we rent from Avis, and most other rental car agencies. They sent a “claims recovery representative” after you from a third-party company, Sedgwick Claims Management Services.

A surprising collection letter

You told us even your insurers were surprised by the provision cited in the collection letter you received:

In discussing this with Amex or my own insurers (State Farm), any insurer would only pay for required damages to repair the vehicle, but no one knew the terms Avis is using to collect from me were the case.

It appears that no matter what insurer I used, they could decide on their own to sell the car and just get from me, or any other renter, the difference. When I call Sedgwick, I find they are effectively a collection company that has no interest at all in discussing this and only remind me that “by contract I owe the money, so pay it.”

The fine print

And indeed, there it is in unlucky section 13 of the Avis rental terms and conditions:

… if in our sole discretion, we determine to sell the car in its damaged condition, you will pay the lesser of the difference between the car’s retail fair market value before it was damaged and the sale proceeds up to the amount specified by law.

The justification for the other $1,100 they charged you is there too:

“As part of our loss, you’ll also pay for the loss of use of the car…”

Yes, even though you reported the accident the next morning to Avis, they get to charge for the time they determine the car was out of commission and unavailable for them to rent.

American Express rental insurance coverage

But you note that your Amex rental insurance would have protected you from this expense if Avis had properly communicated with you and Amex:

I am quite frustrated and upset since to top it all off, they charged me for rental of about two weeks when I could not have gotten it out of impound if I wanted, my not being the owner. They called it lack of use and they will not provide records to Amex showing that if they had the car, they could not have rented it. Amex would pay that if they got the docs. I only planned to rent it for 15 hours.

The good news

I want to compliment you on the way you communicated with Avis throughout this process. Despite being frustrated and upset, your communications were unflaggingly polite and professional — a tone we routinely advise consumers to use when trying to settle a dispute.

But this cautionary tale for everyone who rents a car is a case when being polite wasn’t quite enough. So you asked for our help, as well as that of your lawyer. We’re happy to hear the outcome.

“Your contact with Avis about a month ago started discussions with me, my attorney, Amex and Avis management in New Jersey,” you wrote us. “We found out why Avis totaled the car due to a possible frame bend and Amex paid a bit more to Avis. The rest was waived by Avis and I owe nothing now. Your help was invaluable and you are appreciated.”

Underwritten by

Underwritten by AirHelp

AirHelp is the world’s leading flight delays compensation company, helping passengers apply for compensation following a delayed or canceled flight or when boarding has been denied. It is AirHelp’s mission to fight for passenger rights by holding airlines accountable for flights disruptions that are out of passengers’ control. AirHelp has already helped 5 million people, taking the stress out of applying for compensation and making it as hassle-free as possible for travelers around the world.

Underwritten by Allianz Travel Insurance

The Allianz Travel Insurance company has built its reputation on partnering with agents all around the world to provide comprehensive travel insurance for their clients. Contact Allianz Travel Insurance for a comprehensive list of coverage.

Underwritten by Chubb

Chubb is the world’s largest publicly traded property and casualty insurance company, and recognized as the premier provider of insurance for successful individuals and families in the U.S. and selected international markets, offering coverage for high-value automobile, homeowners, recreational marine/aviation, valuables and umbrella liability coverage. As an underwriting company, Chubb assesses, assumes and manages risk with insight and discipline, and combines the precision of craftsmanship with decades of experience to conceive, craft and deliver the best insurance coverage and services to individuals, families and business of all size.

Underwritten by Enterprise

A family-owned, world-class portfolio of brands. A global network that spans across more than 85 countries. Some 97,000 dedicated team members sharing common values. And more than 1.9 million vehicles taking our customers wherever they need to go.

Underwritten by Fareportal

Fareportal’s portfolio of brands, which include  CheapOair and  OneTravel, are dedicated to helping customers enjoy their trip. Whether you want to call, click, or use one of our travel apps, one thing is clear: We make it easy to take it easy.

Underwritten by Insuremyrentalcar.com

An independent provider of low cost CDW/LDW insurance for use with rental cars. Up to $100,000 cover with no deductible. Policies available on a per day, per trip or per year basis. Also works with overseas rentals. Try  Insuremyrentalcar.comnow.

Underwritten by InsureMyTrip

It’s simple. InsureMyTrip finds you the right travel insurance plan, every time. InsureMyTrip is the authority on travel insurance. Rated A+ for travel insurance by the Better Business Bureau. All travelers that purchase a policy through  InsureMyTrip have access to Anytime Advocates® for claims assistance.

Underwritten by Mediacom Communications

The nation’s fifth-largest cable operator, serving the smaller cities and towns in the Midwest and Southern regions of the United States. We are a high-performance broadband, entertainment, and communications company that brings the power of modern technology and quality customer experience to life inside the connected home by combining ultra-fast gigabit speeds with personalized local and over-the-top entertainment choices that fit your lifestyle. Details at  Mediacomcable.com.

Underwritten by SCOTTeVEST

An innovative apparel brand for people who want easy access to everything they need. For those who live for every second, SCOTTeVEST lets you maximize your life. Ditch the carry-on bag and pick up a  SCOTTeVEST.

Underwritten by Virtuoso

The leading global network for luxury and experiential travel. This invitation-only organization comprises over 1,000 travel agency locations with 17,500 advisors in over 45 countries, and holds preferred relationships with 1,700 of the world’s finest travel companies. Virtuoso advisors collaborate with their clients to create personalized itineraries featuring exclusive perks, while also providing advice, access, advocacy, and accountability. For more information, visit  Virtuoso.com.

Underwritten by VisitorsCoverage

As a company that is constantly striving to simplify travel insurance, VisitorsCoverage, is on a mission to help travelers make the better decisions about purchasing travel insurance, quickly. VisitorsCoverage has helped millions of travelers globally to buy the suitable travel insurance and explore the world with confidence. Get insurance for your next trip at  VisitorsCoverage. Lowest Price Guaranteed.

Underwritten by MedjetAssist

Medjet is the premier global air-medical transport, travel security and crisis response membership program for travelers. With a MedjetAssist membership, if you become hospitalized more than 150 miles from home, we will get you from that unfamiliar hospital all the way home to the hospital you trust. All you ever pay is your membership fee. MedjetHorizon members add 24/7 personal security and crisis response benefits. Elliott.org readers enjoy discounted rates. Travel safer with  MedjetAssist.

Underwritten by Southwest Airlines

The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth.

Underwritten by Sungard Availability Services

Leveraging more than 35 years of experience, Sungard AS designs, builds and runs critical IT services that help businesses manage complex IT, adapt quickly and build resiliency and availability. A leading provider of critical production and recovery services, Sungard AS partners with customers across the globe, delivering resilient IT systems, infrastructure and recovery services tailored to achieving desired business outcomes.

Underwritten by TravelInsurance.com

TravelInsurance.com makes it fast and easy to compare and buy travel insurance online from top rated providers. Our unbiased comparison engine allows travelers to read reviews, compare pricing and benefits and buy the right policy with a price guarantee, every time. Compare and buy travel insurance now at  TravelInsurance.com.

Underwritten by Squaremouth

Squaremouth helps travelers easily and instantly compare travel insurance policies from all major providers. Only companies that meet the strict requirements of Squaremouth’s Zero Complaint Guarantee are available on the website. Compare policies on  Squaremouth.com to save over 70 percent on your next purchase.

Underwritten by Travel Leaders Group

Travel Leaders Group is transforming travel through its progressive approach toward each unique travel experience. Travel Leaders Group assists millions of travelers through its leisure, business and network travel operations under a variety of diversified divisions and brands including All Aboard Travel, Andrew Harper Travel, Colletts Travel, Corporate Travel Services, CruCon Cruise Outlet, Cruise Specialists, Nexion, Protravel International, SinglesCruise.com, Travel Leaders Corporate, Travel Leaders Network and Tzell Travel Group, and its merger with ALTOUR. With more than 7,000 agency locations and 52,000 travel advisors, Travel Leaders Group ranks as one of the industry’s largest retail travel agency companies.

Underwritten by Travelers United

If you’ve been mistreated by the airlines, Travelers United is your voice in Washington. Join the #1 travel advocacy organization working with Congress to improve and protect travelers. Plus, get $400 of annual benefits you can use for travel for only $29/year. Add your voice to ours. Make travel better.  Join today.

%d bloggers like this:
Get smart. Sign up for the newsletter.