Rental Car and Damaged Property in California: Which Party Pays?

Motorcycle Accident
Accident Injury Lawyers

Thousands of accidents take place annually in southern California. Fortunately, the vast majority of automobile accident claims do not actually involve injuries, so many people end up handling them without legal counsel. Even if somebody with property damage needs the case handled, say by one of the more experienced accident injury lawyers, the fact is most of them will not handle claims only for the damages.

Therefore, auto insurance firms at times take advantage of property damage case victims since the insurers know they are without legal assistance. The information below is meant to help people protect their rights following accidents that involve rental vehicles causing property damage only.

Who is Liable for Property Damages Induced by Rental Cars?

Before 1990, the “vicarious liability” doctrine let courts impose liability upon a party (a car rental firm) for another party’s actions (the driver), even if the former was not negligent. Since the “Graves Amendment” became federal law in 1990, the rental firms have no liability in most cases. Now, the law states:

“An owner of a motor vehicle that rents or leases the vehicle to a person (or an affiliate of the owner) shall not be liable under the law of any State or political subdivision thereof, by reason of being the owner of the vehicle (or an affiliate of the owner), for harm to persons or property that results or arises out of the use, operation, or possession of the vehicle during the period of the rental or lease, if (1) the owner (or an affiliate of the owner) is engaged in the trade or business of renting or leasing motor vehicles; and (2) there is no negligence or criminal wrongdoing on the part of the owner (or an affiliate of the owner).”

That is to say, since a car rental company did not directly induce accident or damages, there is no financial liability for them. You will need to look to the rental vehicle driver and his or her own auto insurer. If the accident was not their fault, and the insurer of the other driver will not “accept liability” immediately, this is usually since the firm has not actually been able to get in touch with the driver to get their version of it. The insurer is required by contract to look into a claim fully before paying the same.

A broad investigation usually entails getting their version of it even in obvious liability crashes. The best possible way to get around this as well as have an involved car repaired fast is to have damage by rental vehicle covered under one’s own accident coverage policy or pay for the damages “out of pocket”, and wait for its reimbursement until the insurer accepts responsibility.

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