Who Is Liable In a Rental Car Accident?
Knowing who's responsible for damages before you drive off the lot
By Andra DelMonico, J.D. | Reviewed by Canaan Suitt, J.D. | Last updated on May 16, 2024 Featuring practical insights from contributing attorney Jason TurchinUse these links to jump to different sections:
- Understanding Rental Car Accident Liability and When to Get Legal Help
- What Should I Do Immediately After a Rental Car Accident?
- What Happens If You Crash the Rental Car?
- What Happens If Someone Else Hits Your Rental Car?
- How Is Liability Determined in a Rental Car Accident?
- Whose Insurance Will Cover a Rental Car Accident?
- What if You Didn’t Get the Rental Car Company’s Insurance Coverage?
- What Does Liability Insurance Cover?
- Can I Sue a Car Rental Company for My Injuries?
- Other Potentially Liable Parties
- Find an Experienced Car Accident Lawyer
Are you a rental vehicle insurance buyer or a denier? It is an endless debate that seems to divide friends and families. Whether or not to buy rental insurance seems to elicit strong opinions and feelings in people. However, rental car insurance has the potential for much farther-reaching impacts than the immediate hit to your wallet. Without it, you are left to depend on your personal insurance company or that of the at-fault driver.
Understanding Rental Car Accident Liability and When to Get Legal Help
While rental car accidents are similar to other types, they can potentially cause significantly more complications. When determining liability and making a claim, multiple parties and policies may need to be considered. Speaking with an auto accident lawyer can help you determine the best course of action for recovering from your injuries.
“All the claims would be set up at the same time, and the two insurance companies can coordinate the benefits,” says Jason Turchin, a personal injury lawyer representing clients injured in rideshare accidents in Florida. “We would open up the claim with the third party, and then the rental car company can open up a claim contemporaneously so that the adjusters on the other side can resolve all of the claims related to the accident.”
What Should I Do Immediately After a Rental Car Accident?
In the moments following a rental car accident, you should do all of the same things that you do in any other vehicle accident. Notify authorities to send emergency medical care to those who need it and law enforcement. Remove the vehicle from the path of traffic if possible. Get all individuals to safety and out of traffic if possible and without causing further injury. Provide the requested information to the officer preparing an accident report. Take pictures and videos of the vehicle damage and the general accident location.
After the officer says you can leave, you will begin the claims process. You will need to notify the rental car agency. An emergency number is usually in the glovebox or your rental agreement. The rental company will likely have you fill out an incident report.
If you purchased rental car insurance, then you will proceed with a claim through that insurance agency. If you didn’t buy this additional insurance, the accident claims will go through your car insurance company. Whichever coverage you choose, you will notify the insurance company of the accident and begin the claims process. How this process works will depend on whether you are in an at-fault or no-fault state.
Speaking with a lawyer can give you valuable guidance and insight. Because there is an extra layer of complexity, a lawyer can help you protect your rights and pursue rightful legal action against the liable parties.
What Happens If You Crash the Rental Car?
If you crash a rental car and you are the one responsible for the crash, you are liable for the damages. If you bought the additional insurance, then you should have minimal out-of-pocket expenses. However, this will depend on the severity of the property damage. You will want to read your renter’s agreement in the event of an accident. This will tell you the consequences of the crash. It will also give you the reporting procedures to let the rental company know of the accident.
If you do not buy rental insurance, you will either pay for the repairs out of pocket or notify your own insurance company. You will have to pay the deductible, and the insurance coverage will take over.
Do not try to avoid liability or ignore the rental car company. Attempting to avoid the consequences of an accident will only lead to greater legal problems.
What Happens If Someone Else Hits Your Rental Car?
If someone hits your rental car, how liability and compensation are handled will depend on whether the accident occurs in a no-fault or at-fault state. In fault states, the at-fault party causing the accident is liable for your injuries and the rental car damage. The rental car company will deal directly with the other driver’s insurance company to pursue compensation for the rental car repairs.
In no-fault states, rental car drivers submit a claim to their own insurance company. If you agreed to the collision damage waiver (CDW) or loss damage waiver (LDW), you would submit the claim through this insurance coverage. If you didn’t, then it would go through your personal car insurance policy.
How Is Liability Determined in a Rental Car Accident?
Liability for a rental car accident is determined by considering several factors. Liability could be outlined in the rental agreement. The applicable local and state laws are also considered. If negligence is a factor, then this is also considered. Similar to other car accidents, a single party or multiple could be liable for the accident.
Whose Insurance Will Cover a Rental Car Accident?
Several factors influence which insurance company will cover a rental car accident. Many personal accident insurance policies have a term that extends coverage to rental vehicles. If this is the case, your own insurance company might pay. Some personal auto insurance policies do not extend to rental cars.
When you rented the vehicle, you had the option to buy additional car insurance. If you have a personal car insurance policy that covers rental cars, you can buy the additional supplemental insurance as an extra layer of coverage. Many personal policies state that the rental insurance policy is the primary coverage and the personal policy is the secondary coverage. The policy with your auto insurance company will cover damages beyond the rental insurance policy’s policy limits. However, you will need to read your rental insurance coverage agreement and your personal insurance policy coverage to know what applies to you.
What if You Didn’t Get the Rental Car Company’s Insurance Coverage?
Choosing not to purchase rental car insurance can result in a few possible outcomes. Your personal auto insurance coverage may cover the injuries and damages from the accident. If it doesn’t cover rental vehicles or you do not have car insurance, then you will be personally liable. This means you will pay out of pocket for the medical costs and damages.
If you have a travel credit card, you may have rental car coverage as one of its perks. You will need to check the benefits provided by your credit cards. Then, you will need to review the eligibility requirements to qualify for coverage under the program. You will then need to follow the credit card company’s policy and procedure to activate your coverage and submit a claim.
What Does Liability Insurance Cover?
Liability car insurance covers the injuries and property damage experienced in an auto accident. How this insurance works will depend on whether the state is an at-fault or no-fault state. In at-fault states, the insurance company for the driver at fault pays for the injuries and damages of the accident victim. In a no-fault state, each driver’s insurance company pays for their own. You will see some no-fault states require drivers to carry personal injury protection (PIP) insurance coverage. This is the same type of insurance with a different name. It encompasses liability insurance in addition to other types of coverage. Liability coverage includes:
- Collision coverage
- Medical expenses
- Property repair reimbursement
- Legal expenses from accident lawsuits
Can I Sue a Car Rental Company for My Injuries?
You may or may not be able to file a lawsuit against the rental car company. There was a time when car crash victims could file a lawsuit against the rental car company simply for being the owner of the vehicle that caused the accident. However, this practice ended in 2005 with the passing of the Safe, Accountable, Flexible, Efficient Transportation Equity Act. This law includes the Graves Amendment (49 U.S. Code § 30106), which is a law that limits rental car company liability in car accident lawsuits. A rental company cannot be held liable for the negligence of the driver.
Turchin explains how the Graves Amendment changed the legal recovery landscape for rental accident victims. “The Graves Amendment shifted liability for rental car cases where the rental car companies would only have to provide coverage up to, say, $10,000. They can offer optional coverage to renters, but you could not sue [the rental car company] anymore once that amendment came in. They were effectively absolved of liability.”
Negligent Fleet Maintenance
A rental car company is responsible for maintaining their vehicle fleet. All vehicles must be in safe working conditions and ready to drive on the road. If a vehicle isn’t in safe working condition, there could be a potential negligence claim against the rental car company. To file this claim, an injured accident victim would need to show:
- The company was aware of the issue;
- They chose not to address it;
- They rented that unsafe vehicle to a driver;
- The negligence caused the driver to have an accident; and
- You were injured as a result of the accident.
Negligent Driver Screening
Turchin points out that while rental car companies are absolved of vicarious liability through dangerous instrumentality, they are not immune from any and all liability. “There could be times when you could sue a rental car company for their own independent negligence or potentially reckless acts like in the case of punitive damages.“
Another potential liability claim would be the rental car company failing to screen a rental driver properly. While each company has its own process and standards, it should ensure that the driver can legally operate a vehicle on the road. For example, a rental car company could potentially be liable for renting a vehicle to someone without a valid driver’s license. In contrast, a rental car company may not be liable for renting to someone who got a DUI in the past but currently has a valid license.
Other Potentially Liable Parties
If you are injured in a rental car accident, speaking with a lawyer can help you identify additional potentially liable parties. If a vehicle part defect caused the accident, the rental car company may not have caused it or be aware of it. However, the vehicle manufacturer may be liable instead. If the rental car driver was driving the vehicle as part of their job, their employer may be liable. Finally, if the accident was caused by dangerous road conditions, a government entity could be liable.
Find an Experienced Car Accident Lawyer
Getting into an accident with a rental car is like getting into any other vehicle accident, but it could also quickly become complicated. Getting legal advice from an experienced car accident attorney can help you navigate this unique experience. A lawyer will meet with you during a consultation and provide a case evaluation. With their advice, you can decide what the best course of action is.
Visit the Super Lawyers directory to begin your search for an experienced car accident attorney. For more information on these legal issues, see our overviews on common types of accidents and how fault is determined.
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Enter your location below to get connected with a qualified attorney today.Additional Car Accident Liability and Damages articles
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- Your Smartphone Can Be Evidence in a Car Accident
- Who Is to Blame for a Self-Driving Car Crash?
- When Car Accidents Cause Death: Can I Sue for the Deceased Driver?
- What to Do if You're in a Car Accident with a Company Car
- Navigating Reporting Requirements for Motor Vehicle Accidents
- Who Is Liable for an Uber/Lyft Car Accident?
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