Negligence and car hire

Negligence when driving any self-propelled machine can be costly, albeit with your life, your wallet, your reputation, but negligent driving when it comes to your hire car is going to cost you, most likely more than you can afford.

Negligence means failure to take proper care over something. Negligence when it comes to the law means breach of a duty of care, which results in damage. When it comes to negligence and car hire, you are now taking responsibility for a large machine that probably costs more than most South African's annual salaries, so when there is negligence, there is more often than not, major damage to a rental car, which means hundreds of thousands of Rands you are now responsible for and have to pay.

• In "law-speak", negligence is a failure to behave with the level of care that someone of ordinary prudence would have exercised under the same circumstances.

It normally goes like this - the average negligence story - you've got your car hire sorted, signed the rental document and the terms and conditions, not really listening to the rental agent explaining certain clauses to you because you can't wait to jump into that expensive rental car you booked, (which in truth when it is a luxury vehicle, you would probably not be able to buy because repayments would be too expensive); you have signed for the best car hire responsibility waivers, so you can be certain you won't have to pay a cent more, whatever happens, right?

• Well, not quite. There's always one area that won't be covered - negligence.

No insurance company will cover you for gross acts of recklessness or negligent driving either. If they did, insurance companies and car rental firms would not be able to be in business. So, what counts as negligence when driving a hire car?

Well, it's the same negligent behaviour you would be hell-bent on yelling at your newly-licenced 18 year old son when driving your brand new Mercedes Benz 500SL. These include, but are not limited to, texting while driving, driving too fast, driving under the influence, talking on the cell phone while driving, to name a few.

These should be basic common sense behaviours one should have if behind the wheel of a vehicle that doesn't belong to you... unless you were one of the 25 cases that were handed over to legal by First Car Rental between January and August this year. These 25 equate to a tiny but very expensive 0.019% of all First Car Rental customers serviced in this period who managed to have serious, single-vehicle accidents where there was nothing and no one but themselves involved in the accident.

• Car hire companies do not offer insurance, they offer responsibility waivers. They are not allowed to offer insurance (as in the word "insurance") because they are not authorised financial service providers, but essentially waivers function the same. Just like insurance, a person will never be covered for everything, so therefore, wrong-doings are not covered by insurance companies or car rental companies.

Responsibility Waivers are legal, compulsory agreements between the Rental Company and renters, and generally limit the claim against a renter in the event of loss or damage to the vehicle, provided they did not have the accident through negligence.

Most rental daily rates include all the waivers such as theft protection, collision damage waivers or similar. Some corporate companies have their own insurance and would then opt for an own cover rate option upon opening an account through a sales representative within a car rental company.

Waivers are not honoured by car rental companies in the case of negligence such as driving under the influence of alcohol or illegal substances or not adhering to traffic, road and driving regulations, etc. (all of which are written into law but are common sense when you are driving a car).This means that the customer will be held liable for the full amount of damage, and in the case of a write-off, the full vehicle value.

• When renting a car, ensure that your rental agreement includes a basic level of waivers so you are sufficiently covered in the event of an accident or theft. Always read the fine print on the car hire rental agreement terms and conditions to fully understand liability - but more importantly, drive with the same level of respect and safety that you would drive your own vehicle.

Comments Melissa Nortje, Executive Head: Strategy, Development & Marketing at First Car Rental, "We always assess all damage cases fairly, each case on its own merit, and we always try and do so amicably. This is, however, a very difficult process for both the customer and us as a company, when it comes to a negligence case... a case where our customer is responsible for the full vehicle damage value, and in some cases, the full vehicle value due to write-off, which is the worst possible outcome for any car rental company and the customer. A very small percentage of rentals end up going to legal due to negligence, which is only 25 cases out of almost 130,000 rentals so far this year. If this article could reduce that number further and allow our current and future customers to be more aware, or any other car rental companies' customers, then we have achieved something.

Reality is, the vast majority (99,981%) of all car rental accidents pan out the way the renter envisaged it; you pay a rental amount, you lower your risk with taking a reduced amount, and in the unfortunate event of an accident, you pay the damage value, if less than your responsibility value, or you pay the 'renter responsibility' amount, if the damage exceeded that amount."

Waivers Explained

Please note that waivers differ between car hire companies so please ask the rental agent to explain in detail what you are covered for and always read the Rental Agreement terms and conditions. It is good to know that the top 5 car hire companies (Avis, Europcar, Bidvest, First Car Rental and Hertz) all have very similar responsibility waivers and that they all prescribe to SAVRALA's (South African Vehicle Renting and Leasing Association) general recommended car rental terms.

Collision Damage Waiver

Should you be involved in an accident, you would be responsible for a specific amount as indicated on the rental agreement (called drivers responsibility or in insurance terms, it would be an excess). This would include damage to the vehicle or part thereof, or cost of the damage repair, whichever is lower. If you decline this option when renting a car, you are liable for the full amount of damages incurred or the specified liability.

Car Rental companies sell different rate options with various inclusions, which may include Standard or Super waivers - the Standard or Super refers to the responsibility amount, Standard being the highest waiver amount (like the excess amount you select if it were insurance) and Super referring to a reduced waiver amount.

First Car Rental also offers an Executive product through some channels that waives the responsibility amount altogether and you would therefore not pay anything towards accident damage, but not in the event of negligence.

Concludes Nortje, "SAVRALA revisited all its members' terms & conditions a few years ago to ensure that they were fair and standard across the board. Here are a few other exclusions that car hire industry leaders list under onerous clauses, often referred to as "negligence" clauses. Listed below is an extract from First Car Rental's Terms & Conditions, which is highlighted in fuchsia purple on the copy of Terms and conditions customers' sign and not fine print, as it is with some competitors."

• The LIABILITY WAIVERS do not cover loss of, or damage to the VEHICLE in the following circumstances, and YOU will be liable for all such loss or damage:

  • Where YOU or the DRIVER are in breach of this AGREEMENT;

  • Where damage is caused to all glass, mirrors, lamps, tyres, rims, hubcaps, windscreens or the undercarriage, if no collision of the VEHICLE has occurred;

  • Where damage is caused by water;

  • Where damage or loss is caused by DRIVER negligence;

  • Where damage or loss is sustained in an accident not caused by physical contact with another vehicle, person, animal or object;

  • Where damage is caused by YOUR failure to ensure that the Vehicle's required lubricant levels are maintained;

  • Where damage or loss is caused by pot holes, sand or travelling on gravel roads; and

  • In respect of personal belongings, key replacement, towing fees and claim administration fees.

  • YOU may not decline the LIABILITY WAIVERS offered by US unless:

  • There is a valid corporate account opened in YOUR name; and

  • YOU have signed OUR "Self-Insurance Agreement"; and

  • YOU have provided US with written proof from YOUR insurers that all vehicles rented are comprehensively insured.

  • Subject to our consent, you may, in addition to the LIABILITY WAIVERS, purchase in advance a windscreen and/or tyre waiver. These additional waivers only cover damages to viewing glass caused by stone chips, and tyres, rims and hubcaps caused by potholes and does not cover theft of the said items.