You have rented that perfect vacation rental car online. You were able to get a great deal for only $45 a day for unlimited mileage. You thought everything was all set. I did when my wife Emily and I went to a family wedding in Colorado last summer. When we went to pick up the car at the Denver airport, we had two surprises. First of all, the online price did not include any insurance. If we wanted insurance, which we did, it was another $15 a day. And if we had more than one driver, it was going to be $10 a day for the additional driver. The $45 a day rental bargain ended up costing us $70 a day.
What we learned is that when ordering a rental vehicle online, be sure you know what is included and what is not. Last month, we went on a trip to Chile with our kids Luke and Elizabeth. Two years ago, Elizabeth was a Rotary Youth Exchange student in Chile and spent her senior year of high school there. This trip was for our family to tour the country and have Elizabeth reconnect with old friends. The nature of our trip was such that for part of the trip, we would need a vehicle. We had learned from our last year’s experience, so when we made our rental car reservation, we made sure about the insurance and the drivers.
We spent the first four days in Chile in Santiago. Since it is the largest city in Chile with a population of five million and a phenomenal public transit system, we either walked or took a bus. We were going to pick up the rental car on day four when we were leaving Santiago. When we called to verify our rental car reservation, we were informed that all they had were subcompacts which were too small for four people and all of our luggage.
We asked the hotel clerk if he could recommend a local Chilean rental car company and he did and said it was “very, very good” and “much cheaper”. We were handed a Spanish/English brochure from the rental car agency which offered larger vehicles which would hold us and all our luggage, unlimited mileage and “24 hour roadside assistance in all Chile”. We reviewed the brochure, talked with the rental car agency and we decided to go forward with the rental.
The contract for the rental agreement was in Spanish. Although our daughter Elizabeth spoke and read Spanish, she was unable to translate the rental contract with all of its legal terms. We had it explained to us in detail, or so we thought. We covered all of the insurance requirements, unlimited mileage and anyone over the age of 21 could be a driver. We were told that the deductible for the accident insurance was $400 if we were at-fault and nothing if we weren’t at fault because they would recover it from the at-fault driver. They gave us a 24 hour hotline number to call in the event of any emergencies.
Although they drive on the same side of the road as we do in the US, we found that driving in a foreign country can be a challenge. We quickly learned that lanes, road signs and traffic signals were only mere suggestions. Motorbike and scooter lanes were between the cars and trucks, missing the vehicles by inches. Traffic in the cities was rush hour every day, all day. If you left any space greater than half a car length between you and the car in front of you, someone would take it and you would go nowhere. Tailgating was the norm. Cars continued to go through intersections long after the light had turned red, stopping only after opposing traffic entered the intersection.
And the TomTom GPS that we downloaded with the Chile road maps right before we left was not terribly useful in the cities, and we got lost on numerous occasions. The GPS showed roads that were not there and didn’t show other roads that were there. It showed 2-way streets as 1-way, 1-way streets as 2-way or 1-way the wrong way. I wonder if Garmin would be any better?
When we arrived in Chile, they were in the middle of a drought. In hadn’t rained in most of the country for more than 6 months. As luck would have it, our second day with the car during a five hour drive, it started to rain. Not just a rain shower, but a torrential downpour. As we were arriving into the city of Curico at night in the rain, we were rear-ended by driver who was not paying attention, causing damage to our vehicle. We were not able to get through to the 24 hour emergency number of the rental company, right away. Surprise, surprise. When we finally were able to get through, we were told if the car was drivable, go to the police station in the morning to file a police report, which we did.
Although the car was drivable, it made a racket. Something was rubbing against the driveshaft. After literally dozens of phone calls, this is what we found out. We could take the car to a designated local mechanic in Curico to see if it was safe to drive. If it was safe, we were to just continue our trip and use the vehicle in a damaged state for the rest of our trip. If it was not drivable, we were to leave the vehicle in Curico, and they would come get it. In no event were they going to provide us with replacement vehicle and in all events, we were still going to be responsible for the entire rental fee. If the car was not drivable, we were to find our own replacement rental car. So much for the “24 hour roadside assistance in all Chile”.
Lucky for us the car was drivable. The racket was just the exhaust pipe rubbing against the driveshaft. The mechanic bent the exhaust pipe back and it was safe for us to drive for the rest of our trip. This was good, since we had about at least 30 more hours of driving that we needed to do.
After our tour of the country and the day before our flight home, we arrived back to Santiago. This began another adventure. We went to the rental car agency and the explanation of the rental car contract changed. We were initially told that we would have to pay for the repairs to the vehicle and the insurance wouldn’t cover it because we didn’t get the police report at the time of the accident, not until the next morning. If we wanted to get our money back, we would have to sue the other driver. Fat chance. This was the day before we were leaving.
Lucky for us, one of our daughter’s host family sisters was an attorney. Because we got the attorney involved, we were able to at least get the insurance coverage for the body damage. However, the deductible was now applicable to any accident, not just at-fault accidents. And the deductible wasn’t US$400, it was $400,000 pesos, which was US$800.
So what are you supposed to do to prevent this from happening to you? Well, first of all, make sure that all of the terms are clear and what your responsibilities are, especially in the event of an accident. If there is no accident, you probably wouldn’t have an issue. Make it clear when you have insurance, what it covers. Will it cover the collision damage, property damage and/or personal injuries? Is there a deductible? If you are not at-fault, are you still responsible for the deductible. Under what circumstances would you be responsible for repairs of the vehicle? Hopefully, you will not keep hearing, “we do things differently here than they do in the United States”.
By Matthew M. Wallace CPA, JD
Published edited July 8, 2012 in The Times Herald newspaper, Port Huron, Michigan as: Be cautious with your vehicle rental contracts