Keep your hands on the wheel and eyes on fine print
Car-rental waivers can save you — or sting you
Have you heard the one about rental cars? “What’s the difference between a 4x4 and a rental car? In a rental car you can go anywhere.”
In fact, if you’ve ever read the terms and conditions of a standard car-rental contract, you’ll know that just isn’t true.
Take Bidvest Car Rental’s contract, which includes this: “The vehicle may not be used on any surface other than a tarred road, unless authorised by Bidvest in writing.”
And here’s the kicker: If you do take the rental car’s tyres off the tar and have an accident, you’re responsible for “any loss, theft or damage” to the car, in full.
Most consumers have absolutely no idea just how financially catastrophic renting a car could be, if things go wrong.
There’s a widely held misconception that you buy “insurance” when you hire a car and that the “policy” protects you from financial liability — in much the same way as your own motor-insurance policy.
In fact, the car-rental industry does not insure its vehicles: the companies “self-insure” by means of a waiver system. You can choose between standard waivers or more expensive super-waivers, which limit your liability for the costs of damage, theft or loss of the car, as well as damage caused to a third-party car involved in any accident, regardless of who was to blame.
Costly option
So if the car needs fixing or replacing as a result of what happened to it during your rental period — no matter who or what caused it — you pay only a portion of that cost and the rental company pays the rest.
Avis Southern Africa sales executive Lance Smith says that about 6% of industry rentals result in damage, from scratches and dents to “complete write-offs”.
You will pay a lot more to repair the damage or replace the car if you take out a standard waiver instead of the more expensive super waiver.
The quote to hire a car that you are usually given includes a standard waiver, limiting your maximum liability to around R18 000 or R19 000 even on a budget car.
That’s why savvy car renters always opt for the more expensive super-waiver, meaning that if disaster strikes, they’re unlikely to have to pay more than R5 000.
For example, on a B-group car such as a Ford Figo, you could pay up to R20 000 for repairs or replacement on a standard waiver, and about R4 500 on a super-waiver.
But most renters opt for the cheaper standard waiver, which turns out to be the costly option if there’s an incident, Smith says.
Adam Shapiro of Cape Town had a minor accident in a hired car as he was feeding onto a Durban freeway last year.
He hadn’t opted for the super-waiver, so he ended up paying R18 000 for the repair of the car he was driving and another R9 700 for the other car.
But the biggest risk of all seldom gets disclosed at a car-rental counter: there are many circumstances that could cancel the waiver and leave you responsible for the entire cost of replacing or repairing the car.
Stick to the rules
There’s going off tar — some contracts refer to that as travelling on an “unsuitable” road; damage caused by water, dust storms or potholes; any damage to the car’s undercarriage, and not reporting an accident or theft to the company in time. Dollar Thrifty, for example, gives its clients just three hours to report an accident or theft.
Most contracts also cancel the waiver if, as Hertz put it, “no physical contact was made with another vehicle, animal, object or person, in or on the road surface”.
Think about your vehicle catching fire, as was the case for a spate of Ford Kugas.
Dollar Thrifty excludes what it calls “single-vehicle accidents” as well as “hitting another vehicle from behind”.
Imagine what you could end up paying if your cheap little budget car was sandwiched in even a minor freeway fender-bender: damage to the rental car front and back, plus the third-party car’s damage.
However, Smith says waiver invalidation is rare “and when it does happen, it is usually around behaviour that is against the law, such as speeding, ignoring road signs and driving under the influence”.
You’re also liable for the full cost of windscreen, hail and tyre and rim damage, unless you opt to buy additional, specific waivers, offered by most rental companies at a reasonable extra cost — around R20.
Gille de Vlieg parked a hired car overnight in the driveway of her son’s La Lucia home and discovered a crack in the windscreen the next morning. She was charged R4 100 to replace the windscreen and R800 as an admin fee, reduced to R400 when she complained.
Such claim-handling admin fees apply to all incidents — they vary between companies and are linked to the extent of the claim.