Category: Rental Car Insurance

Florida Lawsuit Challenges Vicarious Liability Precepts

A report being distributed via the Associated Press, says that the Florida Supreme Court has been urged by an accident victim’s lawyer to rule that rental car companies can be held liable for damages in an accident they did not cause in Florida, despite the existence of a new Federal law intended to shield car rental companies from just such issues.

The legal concept in question, “vicarious liability,” refers to holding non-negligent owners responsible for damages, no matter who was actually driving the vehicle. The 2005 Graves Amendment, a federal law, prohibits such liability, except in states that have insurance or financial responsibility requirements for rental car companies. Representative Samuel Graves (R-MO), the law’s sponsor, believes it will save consumers $100 million a year, nationally.

So what’s the issue in Florida? The Supreme Court is investigating whether or not a Florida “Financial Responsibility” law meets the Federal exception criteria. The existing Florida state law says that if the person who drives or leases a rental vehicle is either uninsured, or has combined insurance limits of less than $500,000, the rental car company, “…shall be liable for up to an additional $500,000 in economic damages.”

Marjorie Gadarian Graham, representing the accident victim, told the court, “It is implicit that there is a requirement to maintain insurance albeit it is not expressly stated.” She also argued that the state legislature intended it to be an insurance requirement and that it’s explicit enough to except Florida from the Graves Amendment.

Enterprise Leasing Company’s attoriney, David C. Boruke, disagreed, and countered by saying, “Nothing is required. It’s an option. It’s an opportunity to make a cost-benefit analysis, but it is not required insurance by any stretch of the imagination.”

A trial judge in Palm Beach County and the 4th District Court of Appeal, in a 6-4 opinion, sided with Enterprise. Accident victim Rafael Vargas’s vicarious liability claim was rejected by both courts. Vargas had been injured when an Enterprise-owned vehicle rear-ended his car in February 2006. Vargas never alleged that the rental car company was at fault or negligent, nor did he allege that the lease was improper.

Despite siding with Enterprise, The 4th District certified the issue to the Supreme Court calling it a “…question of great public importance…” There are severall similar cases on hold pending a ruling, in Flordia, and other states are facing similar issues. One such state is Minnesota, where the state Supreme Court ruled that the Graves Amendment pre-empted a similar state law already on the books there.

Most of the resultant litigation has been at the federal level. The 11th U.S. Circuit Court of Appeals in Atlanta, GA, ruled that Florida’s law was also pre-empted. This means that the Florida court’s decision would apply only to state courts.

Skip the Insurance: How to Save Money on a Rental Car

Whether you’re traveling for business or pleasure one of the elements of your trip is likely to be a rental car. With enough discounts and coupons, you may be able to spend your time away from home tooling around in a car that is much more luxurious than your own daily driver. On the other hand, you might be compressing yourself into a subcompact. Either way, at some point saving money will probably cross your mind.
Here are five ways to save money at the car rental counter.

  1. Off-Airport Locations: Sure, getting your car at the airport is convenient, but did you know that you pay for the 24-hour staffing and airport shuttles that allow you to do so with ease? Even if you’re renting while on a business trip or vacation, consider grabbing a taxi to an off-airport rental site. The cab fare will generally be significantly less expensive than the fees added at the airport rental location.
  2. Skip the Insurance: Generally speaking, the answer to “Should I buy rental car insurance?” should be “No.” While it’s true that you as the renter are responsible for any accidents that happen while you’re driving, your personal auto insurance probably already covers you, and if you’re paying with a credit card, chances are there’s automatic coverage from your card provider. Finally, if you’re traveling for work, you may be covered by your employer’s insurance.
  3. Pick Your Dates Carefully: It’s common knowledge that weekdays are less expensive than weekends, and that a week-long rental may be less expensive than four single days, even if you end up turning the car in early, but did you know that when you travel can affect what you pay for your rental car? Check the events calendar for your destination city. If there’s a major festival, celebration or other event, consider altering your travel plans to a time when cars won’t be in such high demand. Rental companies can – and do – raise their fees when a big event is happening, and a recent article in the Miami Herald suggests that choosing off-peak travel dates can save you a lot of cash.
  4. Rethink that GPS: Most of us got where we needed to go fairly easily before navigational systems became popular. While it may be tempting to pay for that onboard GPS if you’re in a new city, consider that you’re paying up to $15/day for a service you may already have on your cell phone. Don’t own a smartphone yet? Maps are free at most rental desks, and state tourism offices.
  5. Fill’er Up: Never agree to return a rental car empty or skip a fill-up if you’ve opted not to prepay for a tank. You’ll pay up to twice the going market rate for each gallon, and if you return a car only partly empty, you may be charged for a full tank. If you know your schedule will be tight, ask your host or hotel for the location of a gas station near the airport, or scope one out as you leave, to save time during drop-off.

Rental cars are useful, of course, and can often give you experience with a car you’d never get to drive otherwise (you might rent a hybrid for a week, for example), but that doesn’t mean you should waste money where you don’t have to. Choose your features wisely, follow these tips, and save your cash for important things, like postcards and cheesy souvenirs.

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