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Priceless Rent-A-Car

Michael of Waltham, MA, writes:
I came across what looks like a new gimmick to make customers purchase collision damage waiver on car rental, even when renting with a gold/platinum card that covers the deductible, and when the regular auto insurance policy covers rental cars.

Priceless Rent-a-Car in Las Vegas, NV has a clause that make the customer responsible for "loss of revenue" in case of damage to the car. In other words, the customer pays daily rental rate for the days the car spends in a body shop. I never saw a clause like that before with any other rental company.

I did not purchase the CDW and did not damage the car, so I cannot comment on the actual enforcement of the clause, but when the rental guy spoke with my insurance to verify coverage, he asked them if they cover his loss of revenue, and then pressed me to buy CDW based on the fact that my insurance obviously does not cover that. By the way, when I rented a car from them, it had numerous scratches and dents with stickers "settled" over them, so apparently they don't hurry to a body shop even when a car is damaged. In fact, time in body shop would be hard to verify in a distant city after you leave.

I believe, the sole purpose of the clause is to make customers buy collision damage waiver. Is this a legal practice? Maybe it is legal in some states and illegal in others? Any pointers?

This is such a new and novel twist we're not sure if it's enforceable. The best way to avoid this seamy practice is to steer clear of any company that tries to pull it on you. We'd recommend getting back on the shuttle bus, going back to the airport and renting from someone else.

The company responds:

I must respond to the charge that Priceless Car Rentals is trying to scam their customers with a new gimmick by making the customer responsible for "loss of revenue" in case of an accident. This is not a gimmick, it is a law. If he would like to take the time to look up Nev. Rev. Stat. Ann. 482.31585, 482.3159, he would realize that every rental agency that offers a damage waiver has the right and indeed does charge for "loss of use."

I took the liberty of contacting every major rental agency in Las Vegas and asked them if they charge for "loss of use" and every one of them admitted they did. We just happen to be the only agency that tells their customers what they are liable for upfront. We are a small independent dealer and we do not have the luxury of standing behind a wall of corporate lawyers. We try to anticipate and correct any misunderstandings ahead of time. We do not want our customers to be surprised after the fact if they have an accident. The other agencies place that fact in their fine print.

As to the allegation that he rented a vehicle with scratches or a minor dent, he obviously does not understand the term "loss of use." Loss of use is put into effect only when we are unable to rent the vehicle due to an accident. We do not charge loss of use for a cosmetic problem. We charge loss of use when the vehicle is so damaged it does not run properly or there is a safety issue involved. As to how fast the vehicle is repaired after an accident, that depends more on your personal insurance company than on us. We cannot get the vehicle repaired until they process the claim. So the question is, "How reliable is your insurance company and can you check up on them?"

I am sorry Michael felt he was being scammed when our only intention is making him fully aware of his responsibilities. After he was informed he made the decision not to take the coverage but the fact is he made an informed decision. Our collision damage waiver is not required. The customer may decline it at their discretion if they have their own insurance coverage. I guess he would feel more comfortable finding out after the fact because he obviously has never read the fine print.

As to the editor that answered Michael's letter, I wish you would have done your research before you condemned us for trying to inform our customers. We are trying to be one step ahead of our competitor by being honest and aboveboard with our customers. We do not charge additional monies for underage drivers or for additional drivers. We also do not try to hide the customers' responsibilities from them. If you are going to make an accusation, next time get the facts first.

Sincerely,
Julie Bock

We frankly had no idea agencies were now charging for loss of use, although it is perfectly logical for them to do so. We thank Ms. Brock for straightening us out.

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