Can this trip be saved? That’s one “hail” of a repair bill

You can drive your rental car extra-carefully — stay on paved roads, park in a garage and obey all traffic laws — but you still can’t control the weather. That’s the somewhat obvious but no less unfortunate lesson learned by Yolanda Liu when she rented from Payless Car Rental in Denver.

Liu’s vehicle got caught in a hail storm, and now Payless wants her to pay $813 for the damages. Is insisting on it, actually. The last notice from Payless’ claims agency, Subrogation Management Team, demands full payment immediately or her case will be “turned over to a national collection agency.” (See undated photo of the alleged damage, above.)

For a car rental company perspective on claims, check out this interview with another subrogation company from a few weeks ago.

This isn’t as straightforward as some of the other car rental cases I’ve featured on this site, as you’ll see in just a minute.

It all makes me wonder: Should a car rental company, or its insurance company, ever cover an act of God that was completely beyond the control of one of its customers? (You’ll recall that a few years ago, car rental companies changed their terms so that renters would be responsible for any damage caused by weather or natural disasters.)

And how much documentation should be reasonably required in order to pay a claim?

Here’s what happened to Liu: When she rented the car last summer, she turned down the optional collision-damage waiver because she already had car insurance.

During the three-day rental period, there was a rain storm with hail in the Denver metro area — which is common during the summer — but the car was never damaged or involved in any accident.

When I returned the car, a counter agent inspected the car and did not notify me of any damages.

Later that month, I received a call from a representative at “Subrogation Management Department” and she said Payless had found “hail damage” on the car I rented. I asked her where the “damages” were located, she claimed they were all over the body, but she said they were really difficult to see from the photos.

Then she emailed me the claim and photos of the vehicle. There is no sign of hail damages, except the yellow pen marks made by Payless. Moreover, the claim did not include a professional evaluation of these hail damages, nor did it include any documents on loss of use and my acknowledgment of the damages.

Liu asked Payless for proof that the vehicle was damaged while in her possession, documentation of any loss of use, a contact at the repair shop and any documents signed by her which acknowledged the hail damage. In response, she received the following note:

The car has not been repaired. If you wish to send someone to look at the vehicle, please let me know and I can arrange it for you. We have provided all of the necessary documents for this claim and cannot send any more proof of the damages.

So Payless is charging her for a car that hasn’t been repaired? It won’t give her the name of the body shop, can’t show her the paperwork and it took them several weeks to “discover” the damage to her car?

I can see why Liu would have a problem paying this claim.

Now, to be sure, she should have done a few things differently. Like taking a picture of the car, before and after. Or getting the Payless associate to conduct an inspection when she returned it, and asking a representative to sign the receipt to acknowledge the car was damage-free.

Liu’s car insurance company will almost certainly refuse to pay a questionable case with “iffy” documentation, so it’s little wonder that Payless and Subrogation Management are coming after her.

And yet, if the damage happened while the car was in her possession, shouldn’t she be responsible for it?

What do you think? Should I mediate this case?

A quick poll of 800 readers showed a hugely overwhelming number (98.5 percent) thought so. I’ll get right on it.

  • Brian\PVD

    This amount may be more than her deductible. I say she turns it over to her insurance company if you are not successful.

  • Jonathan

    How is this scenario even legal?!?!? I’ve said it before and I’m sure I’ll say it again – the car rental industry better start regulating itself on this before some political hack in Congress sees it as best way to grab some attention for him/herself and puts a heavy hand on them like the airlines suffered!

  • Emanuel Levy

    I say you should try to work this one out. Car rental companies are in business to rent cars and they should cover things that are beyond the control of the renters.

  • Raven

    Yes, mediate this one. Sounds like there’s a lot of shady dealings going on at Payless rentals.

  • Alex

    I say yes. I want to point out that she says an agent DID inspect the car. It does not say whether they signed off on it, but that would be my assumption if someone inspected it.

    I would also assume that her insurance won’t cover this, and that is why the company is coming after her.

    If you won’t help her, I would suggest a lawyer, small claims court and include suing them for fees.

  • Monica

    I used to live in Denver and I’m very familiar with the afternoon hail storms. It’s very common to drive around and see cars that look like golf balls due to the dents. Most insurance companies won’t even provide hail insurance in Colorado. Hail in Colorado is like flooding in the OBX.

    The OP says someone inspected the car when she returned it and did not mark any damages. Hail damage would have been noticable on the hood, roof, and trunk. Since the rental employee did inspect the vehicle and did not notate any damages, the OP should be off the hook. Plus the pictures don’t look like there’s any damage. The yellow marks on the car don’t highlight anything as far as I can tell.

    Chances are the car was parked in the lot when another hail storm rolled through. The next renter noticed the damage and the rental company just went after the last person that had the car.

  • http://www.thetravelinggiraffe.com Crissy

    I would pursue this one. The rental car company is not providing sufficient proof that this even occured during Liu’s rental period. And if the damage wasn’t significant enough that the person checking the car didn’t notice and that they had to mark on the photo or the car where the damage was, I question the damage and if Payless is even going to fix it.

  • Jeanne in NE

    Depending on the lighting at the place where the car was returned, hail damage may not have been apparent when Ms. Liu looked at and then returned the car. I know that when it hails here, you have to wait for a sunny day and then stand looking at the hood, panels, etc. and look across the car.

  • cjr

    “a counter agent inspected the car and did not notify me of any damages.”

    And this statement, if accurate, signals the end of the customer’s responsibility for the vehicle.

    These companies CANNOT be allowed to continue to come after customers weeks after vehicles have been returned. This is attempted fraud on the part of Payless.

  • John

    If the company can prove it was damaged in her care, she owes them for the damage. I don’t think that they have met the standard yet especially since she had someone inspect the care for damage after she returned it and got a “clean bill of health.”

  • David Emery

    Generically, I think rental car companies should be obligated to inspect cars upon return and establish any renter culpability -at that point-. And that’s the law I’d suggest to Congress if they have to take action.

  • Mike Z

    I agree with cjr. If the agent did indeed inspect the car and did not note any damage, then her responsibility is concluded. Plus, if these storms are common in the area, who is to say that this did not happen on some other date. the photograph is not time stamped and would never even be admitted into a court as proof. I’d say that all she needs is that check in slip that doesn’t note any damage. I would also advise her to contact the company in writing about the dispute so that they do not put this on her credit report.

    Sadly, companies think that just because they send you a bill, they have given proof, even without supporting documentation or time stamped photos.

  • MarkieA

    I agree with earlier posters. This is ridiculous. I say, officially ignore the threats from Payless and their collection thugs, while, at the same time, gather your “evidence” together for a fight. Let ‘em take you to court. They’ll have a hard time proving anything. The only thing she could have done differently is to insist that the Payless employee actually sign an “all clear” on the paperwork. This crap about “discovering” damage weeks or months later has got to stop. I returned a car to Enterprise in Providence last summer. I asked for a signature that an employee had inspected the car and found no damage. They tried to “wait me out”, stating that they wouldn’t have someone available to do the inspection for an hour or so. Luckily, I arrived at the airport very early. I waited. When they saw that I intended to sit in their lobby and loudly make inquiries every 10 minutes, they finally, grudgingly sent someone to do the inspection. Funny how they found someone right away.

  • Joe Farrell

    If they did not notice the damage when she returned it – how can they tell it was damaged when it was in her possession?

    I say send the subro company the following letter:

    “I specifically deny that the vehicle was damaged while in my possession. I specifically deny that I owe your principal anything in excess of the rental amount which I have already paid.

    I have not seen any documentation which reveals damage to the vehicle while in my possession other than your client’s claim that it is so. The photos provided are inconclusive, there is no estimate, there is no proof the vehilcle has not and could not be rented in this condition or that the damage occurred while in my possession. Making a claim a month later is not sufficient and clearly suspicious by its very nature that fraud is afoot.

    I remain willing to entertain a review of a properly supported claim, but what you have presented to date does not even come close to the level of proof needed in a court of law. If you have such information, please provide it within 10 days of the date of this letter.

    I remind you that your rental agreement contains an attorneys fee provision that is reciprocal in my State. If your client is not successful in a court of law proving my liability I will pursue repayment of my costs and fees generated by your baseless claim.

    I invoke all rights under the Fair Credit Billing and Collections Act and deny that I owe your client anything. Further threats of collection without proof of a valid claim will be met with all rights available to me under the Act and under applicable law. ”

    End of story – end of letter. Send it – she will not hear from them again. Ball in their court and they have to see that lack proof of a claim.

    Car rental companies will NEVER sue anyone since if they ever LOSE a case on the basis of timing or accepting a vehicle and then coming after someone a week month or 3 months later they are screwed in ever collecting anything again unless they notice the damage when the vehicle is returned.

  • Chicky

    Oh yeah, mediate. That photo could be any car, any make, any model. Did any photos include a shot of the license plate, so Ms. Liu’s insurance company could even substantiate it’s the same car?
    Also, is this the only damage on the whole car? None on the top, the trunk, the other side of the hood? Hailstorms aren’t uncommon in my neck of the woods either, and I’ve seen what they do to cars, and it’s usually all over, not just in one section, unless that was the only side of the car exposed to the outside.
    Something else: how big was the hail? Pea-sized hail (the most common size) *usually* won’t do that much damage to a car. It has to start getting quarter-sized or ping-pong ball sized to do the kind of damage that car supposedly has. The National Weather Service in Denver could verify how big the hail was that day.
    One other thing: hail damage that extensive should be more visible, under any lighting. One other thing? Actually, about a dozen other things are wrong with this situation.
    Mediate this one for sure, Chris. All the tap-dancing Payless is doing makes me think something fishy is going on.

  • Dan

    @Markie A — one ignores collection notices at their own peril. One MUST respond to them if the person want to protect their credit.

    You know what sucks? Every travel agent or provider holds themselves harmless from any act of god. Why should the customer be any different?

    I’m all for passing a law that says a renter must be notified within 24 hours of vehicle return of any damage, and if notice wasn’t provided, the rental agency can’t pursue damages or blacklist the customer. Inevitably, the industry will respond that this will raise prices. So what? I’ll pay $5/day for the peace of mind knowing I won’t get a surprise bill of $800 a month later.

    All of these damage stories just reinforce my choice to avoid car rentals as much as possible when I travel.

  • Tim@OKC

    I’d advise this OP to contact the Colorado State Attorney’s office, Consumer Fraud website., and file a complaint. Provide this “suspect” documentation (or lack thereof) along with the complaint, and notify Payless (Corporate) of having done so.
    As has been seen on this site many times recently, this appears to just be another example of a rental car company trying to “scam” one (or more renters) to pad their bottom line.

  • Sarah Di

    I voted yes to mediate. If Payless wants her to pay this claim, then they need to actually provide documentation that shows she’s responsible. A claim with undated photos that don’t actually show any damage isn’t going to do it and no insurance company would pay a claim that a customer would submit with that documentation. Even if she goes to see the car, there’s only proof then that there was damage, not that she was responsible for the car when the damage occured. It was a clean checkout with an inspection and no damages noted by customer or employee. I think Payless is running a scam here and if they want payment for these “damages,” they’re going to actually have to provide proof that a) they exist and b) the customer was responsible.

  • David H

    As far as I u.nderstand this, because there was a hailstorm whilst the car was allegedly in the renter’s possession, they deem that renter is liable.

    If the car had been parked in Payless’s compound when this happened, would they have eaten the cost or tried scamming a previous renter?

  • Joe M

    It’s really starting to seem like we’re being arm twisted into buying Collision Damage Waiver with every rental. It’s like paying protection money to the mob.

  • PDug

    Chris, why on earth would you say she should have taken before and after photos of the car? I have never once heard of someone doing that when renting a car.
    Do you take photos of your car rental before driving it off the lot when you rent?
    I know you like to point out both sides of the story and where the customer should have covered their end, but taking before and after pictures of a rental car is an absolutely ridiculous suggestion and to imply that Liu acted wrong by not doing that is way off base.

  • Brian C

    They inspected the car on her return and no damage was noted. At that point it becomes the responsibility of the rental company. If this damage is so bad, they should have noted it at that point. Who is to say that the car wasn’t left outside after another hail storm and the damage occurred after the car was returned.
    The problem is there is no clear line of custody after the car changes hands back to the rental company. If no damage was noted at the time the car was returned, for something as obvious as body damage, how can we believe that the damage occurred while in the possession of the renter? Even if the damage did occur while in the possession of the renter, the rental company was negligent in their responsibility to inspect their vehicle and it is now their problem because the did not note the damage upon return.
    The fact that they aren’t willing to send an independent quote from a repair company, speaks volumes in these cases.

  • Ed

    She should check the weather for the weeks between when she dropped off the car and when they sent her the photo…If summer hail storms are so prevalent, this may have happened *AFTER* she returned the car and they are just trying to pin the damage on her since she was the last one to rent it.

  • LeeAnne

    AAARRRGGGHHH!!! So frustrating to see car rental companies continue to perpetuate this scam. And now, using such dire threats – it’s a crime, and I think the Attorney General needs to get involved and STOP this.

    Think about the people who don’t understand their rights, and might be terrorized into paying? That’s so wrong I can’t even believe that they continue to get away with this.

    PLEASE do mediate this one – and don’t allow Ms Liu to become another scam victim.

  • Rick D

    Are there any car rental companies that DON’T scam their customers like this?

    Because of increased airline/airport hassles and car rental scams, lately I’ve been making trips using my own personal car or just not making trips at all. I’d like to take a trip to Hawaii soon, but unfortunately I’ve yet to figure out how to drive my car there…

    I wonder if car rental companies know or care how much damage they are doing to their own reputations and business by doing things like this.

  • Roger

    I would love to get my hands on the original photo file to check the EXIF data for a date, and to inspect that partial date / time stamp for evidence of PhotoShop magic.

    The photo posted above is lacking all the EXIF data a digital camera would have embedded in the file, suggesting it has been re-saved from editing program. This could simply be a result of the process of getting it posted in this article, so a look at the original file sent to the renter would be interesting.

    - Roger

  • Chicky

    @PDug: Since reading about some of the apparent attempts by car rental companies to scam renters on this site, I always take before and after photos of my rentals. I just take a couple of minutes before I get in the car, and walk around it with my cell phone. When I fill it up before returning it, I do the same thing. I don’t think Ms. Liu was negligent in not doing it, but I make a habit of it.
    I’ll be the first to say it’s outrageous that anyone should need to do it, but as far as I’m concerned, it’s a free insurance policy that protects me, at least in part, from that kind of funny business.

  • Mindy

    Would a CDW even cover this? I mean.. it wasn’t a collision. This type of damage is typically covered by the “Other than Collision” coverage on a personal auto policy.

  • KathyJ

    Having had an experience years ago of hail damage to my own car, I learned an interesting side effect: by the time I had obtained an appraisal for repairs and sent same to insurance company and fiddled around with various other paperwork, the sun had heated the car metal (I had no garage at that time, hence the hail damage) enough times to pop out the vast majority of the dimples, so that the damage left was only the largest spots. And the cost to repair went way down.

    A month after the fact, I’d expect most of the damage to have self-corrected.

  • Joe Farrell

    I will point out that a good lawyer will use the fact that you took photos before and after a rental against you . . . . ‘what do you mean, ma’am, you took photos of the car? Did you intend to damage it? Explain for us why you felt compelled to take pictures? You did not trust us? Why did you rent from us? If you did not trust us, why didn’t you rent from someone else? Did you intend to damage the vehicle and return it with hidden damage?”

    Now as strange as that may seem . .. in a court room you will feel very awkward explaining yourself . . .

    That said – I do it all the time now – having a droid its ez to scan the vehicle in HD video – dark or not . . . .

  • BucksterSF

    Payless Car Rental. You get what you pay for. That never changes.

  • LeeAnne

    @Joe Farrell – Ha! I’d have a field day with that lawyer. I would tell him about all the scams of this nature I’ve read about on this blog…I would tell him about the time when Hertz tried to blame me for scratches on the trunk of a vehicle that I rented, until I whipped out my digital camera and showed them time-stamped photos of those same scratches on the car before I left the lot on the day I rented it…I would tell him, damn RIGHT I don’t trust this company, because I don’t trust ANY rental car company, as they all participate in this scam! I would relish the opportunity to have that happen to me in open court.

  • Texas Road Warrior

    I agree Chris should get involved. In the last sixty days I have rented from three different rental agencies. What I’ve discovered is a reluctance on the part of intake personnel to not only sign off that the car is damage free upon return but even inspect the vehicle. On two occassions I had to get a manager involved in order to get my receipt signed. On the one that I did get the employee to sign off (Alamo), I later received a letter from their damage unit informing me that I had returned the vehicle with a damaged bumper and demanding I pay $500 for repairs. When I politely informed them that I had a signed receipt from their intake personnel that the unit was returned with no damage their response was the employee was not authorized to sign off and it didn’t matter. I have steadfastly refused to pay and my last communication to them was to sue me for the damages and I will suponea the employee as a witness. Their response was to inform me they were re-opening their claim with the rental facility and the investigation would take a minimum of two weeks. I find that suspicious because it took them only three days after I returned the vehicle to notify me I was responsible for damage to the unit which would indicate they did not initially investigate the claim prior to contacting me.

  • Steve

    First off, I agree with the others that Payless should be forced to come up with a lot more proof that the car was damaged while in the renter’s possession. So yes, I think this case is worthy of mediation.

    Second, I know the terms of the contract are the terms of the contract, and the contract says that the renter is fully responsible for the vehicle while it’s in the renter’s possession…but surely I can’t be the only person who finds it incredibly unreasonable for hail damage to be the customer’s responsibility? What’s next – if your headlight burns out while you’re driving it, are they going to charge you for replacement? What if there’s a mechanical breakdown that can be proven to be no fault of the driver – are they going to be charged for that, too?

    I think it’s long past time for some intervention to force the rental companies to use a little common sense in drawing up these contracts. There are damages that it’s reasonable to hold the renter accountable for, and then there are things like hail damage. If you loaned your car to a friend and he crashed it, you would expect him to be responsible for the cost; if you loaned your car to a friend and it happened to hail that afternoon, you wouldn’t expect him to fix that, though, would you?

  • Troy Gorda

    If the travel industry is protected from acts of God, then the customer should be equally protected.

  • http://www.cockam.com ajaynejr

    I would suggest that the renter refuse to pay the bill and let the company do the suing.

    Yes you have to answer a summons but you do not have to treat a collection agency specially compared with the original company or creditor. A collection agency must pursue a claim in the same manner as the original creditor and entertain the same defenses and disputes that the debtor sends in and that might have been sent to the original creditor earlier. Example: Once a collection agency contacted me regarding an unpaid electric bill. I started by asking them to send me a record of the kilowatt hour usage. They apparently could not regurgitate that and I never heard from them again.