Why you should never walk away from a hit-and-run in your rental

snaking roadIn an ideal world, every customer-service problem would solve itself. Thanks to Punit Joshi, we’re one story closer to that world, in a small way.

Joshi rented a car from Budget in Oahu last summer. While he was driving, a vehicle rear-ended his rental. The other driver offered him “a couple of hundred bucks” before fleeing the scene.

“I called the police and they prepared a report,” he remembers. “Honolulu PD was able to locate the driver and completed an accident report with the guilty party’s information. I also prepared an accident report using Budget’s accident report form that they put in every rental car.”

Joshi turned in the report at the Budget counter in Honolulu.

“They said that they would be in touch with me,” he says.

Case closed? Not exactly.

Like other car rental companies, Budget’s terms are clear when you rent one of its vehicles. If you damage one of its cars, you’re responsible. And apparently that extends to any necessary paperwork and the follow-through. Filling out a form didn’t cut it. In fact, Budget treated it almost as if he’d walked away from an accident.

“I received a phone call about two months later,” he says. “It was a Budget accident claims analyst, and she asked me to provide her with the details of the accident. I didn’t want to give them a hard time, so I went back home and sent them the information again.”

Did that do it? Nope.

About a month later, he received a letter saying Budget had tried to pursue the at-fault party, who, according to Joshi, had a revoked license, was uninsured, and was driving under the influence. But if it couldn’t, Budget would hold him responsible.

“I didn’t have a problem with this,” he says. “My problem was that instead of contacting my insurance company, they wanted to stick me with the bill.”

Undeterred, Joshi took a few extraordinary steps to avoid a $6,600 damage charge. On a subsequent trip to Hawaii, he contacted the Honolulu police to find out if Budget had missed something when it processed his claim. It turns out the company had overlooked a large part of the police report. He also contacted Budget’s corporate office to see if it could send the claim to his car insurance company.

What does all of this mean to you? Well, if you’re ever in an accident with a rental car, here’s what you have to do.

Get a police report. Without one, the car rental company will assume you damaged the car, and will hold you, or your insurance company, responsible.

Share the report with the rental company. Unfortunately, you can’t assume your rental company will get all the necessary paperwork. “Don’t rely on the rental company’s claims staff to do their job correctly,” he adds. “If I had waited for that, I’d be out $6,600.”

Call corporate. Ask to speak to a manager or supervisor in loss control or the damage recovery unit. Budget’s claim team was based in India. “My parents are from India — don’t get me wrong, it’s a great country filled with smart people. But [Budget’s claim team] didn’t know what they were doing. The supervisor in India was as clueless as the staff,” he says.

Stories like this suggest some car rental companies go for the low-hanging fruit when it comes to damage claims. Budget’s Honolulu location made a minimal effort to file a claim with Joshi’s insurance and instead stuck him with the bill. He might have paid, had he not been so determined.

I wonder how many other car rental companies feel the same way about damage claims.

“I hope no one else has to face a similar situation,” he says. That makes two of us.

Do car rental companies make it too difficult to process a damage claim?

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Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at chris@elliott.org. Got a question or comment? You can post it on the new forum.

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  • sdir

    I’m curious, why would Budget make a minimal effort to follow-through and file an insurance claim? Insurance would pay the claim and the issue would be put to rest quickly, versus trying to get a customer to pay such a huge claim out of pocket (something not many people could do, I expect). Ultimately, the claim would go to collections and Budget would only get a percentage, after the collection company was done with it. So why not submit to insurance in the first place?

  • John Baker


    Do you know what was hiding in the police report that changed everything so dramatically?
    In the grand scheme of things, when an uninsured driver hits you, your insurance has to pay and then try to collect from the uninsured driver. I wouldn’t expect anything different from a rental car company. If the hitter is uninsured, the insurance for the driver of their car would have to pay.

    Did the OP ever file a claim with his insurance? I would think that their adjuster would have done the leg work he ended up doing and unless he was driving uninsured, he would not have been out the $6600.

  • Cam

    Can’t vote, because I have no idea.

  • TonyA_says

    I just sent a link of this article to a dear friend who is also Indian like the OP and who also had an accident (together with his relatives from India as passengers) just recently in SFO on a budget rental car. He called 911 and since no one was hurt the 911 operator said the police would not come and do a police report. But a few day’s later the driver of the pickup that bumped them is saying she is hurt. Let’s see what happens. I’ll report back to y’all.

  • disqus_A6K3VBf8Zn

    This is why I buy their insurance. It costs a lot more in the short run. But if something like this happens, you only have yourself to blame.

  • Cybrsk8r

    For the same reason scratch and dent claims are always $490. Car rental companies do not want insurance investigators turning over rocks. Something might slither out that Budget doesn’t want anyone to see. Far safer to try to get the renter to pay up, first, and then go to their insurance company, if nessesary, as a last resort.

  • Cybrsk8r

    Well, you either work for a car rental company, or you’re just an incredible chump. Get an AMEX card and sign-up for their car rental insurance. A $24.95 flat-rate covers your rental up to about $52K and 28 days.

  • Suzy blew

    Totally agree. We got hit by a snowbird in Arizona in January. Police arrived and provided a report. Driver couldn’t even write his own details! Had full insurance and called Dollar. No problems, even had a special helpline. Press option 1 if fatality, option 2 if noone injured etc. These Am Ex offers dont apply overseas and often international visitors don’t realise what the different level of insurance actually mean.

  • Carver Clark Farrow

    That’s only if the OPs regular insurance includes insured/underinsured motorist.

  • Jim Daniel

    I have some background in CALIFORNIA law as a Process server. I can’t speak to Hawaii or whatever state Budget is operating in (remember that clause in 4 point type printed in gray on the back of your contract that says something such as: “under the laws of the state of Jefferson”).

    In California, two parties represented by insurance companies must still sue each other, the insurance company does NOT sue the other company. That means, Budget might be after this poor renter to follow up on the claim in court! Here, the individuals turn over the lawsuit to their companies, but it has to start with person vs. person.

    Clearly to me, he should have immediately involved his insurance carrier, even at risk of additional expense. I just had a tiny, parking lot scratch, appear on the bumper of a rental, and I documented it clearly and immediately sent photos to my agent. Lucky for me, the agent shrugged it off when I returned the car.

  • Carver Clark Farrow

    Buying the rental car insurance is in general a financially terrible idea. The cost vs the likely risk is highly lopsided. If you are highly risk averse, a far better option would be to have full coverage on your personal vehicle with a low deductible, and to ensure that your coverage includes rental cars.

  • emanon256

    I was driving an avis rental back to LGA once when I got rear ended by a speeding jeep trying to pass me in stop and go. The jeep was weaving in and out of the shoulder. The jeep driver yelled that his wife was in labor and they were headed to the hospital. He then took off, fortunately, I already had his info. I waited for the police, filed a report, gave it to Avis, was assured they would go after the person who hit me, and never heard from them again.

    Of course I also had bad experiences at this particular Avis.

  • TonyA_says

    Oh I need to add my friend charged the rental car on his AMEX card and he thinks AMEX will take care of it all.

  • SoBeSparky

    Seems to me Chris’ excellent advice–get police report, share report with company, call corporate–is not difficult. So why would rental companies be labeled as making “it too difficult to process a damage claim?” Three simple steps to create a crystal clear paperwork path. That’s basically what I would do in any accident, except substitute “my insurance agent” for “corporate,” even though I would also be dealing with a claims adjuster. Always good to have two contacts with a company.

  • ExplorationTravMag

    I know I’m going to take some heat for this but, the one time I needed to use insurance to take care of a damaged rental car, it all went so smoothly.

    My car was broken into as it sat in front of the location at which I was staying. Window broken, locks on the storage places broken, things stolen out of the car, etc.

    I called the police and got a report done. I called the rental agency (at the DAY airport), which was also Budget, to ask what was their protocol for this. I called my insurance company and got a claim number. I drove the car back to the rental agency, gave them the contact info for my insurance company, the claim number, the name and number of the officer who took the report and the report number. I never heard from them again.

    Is it possible the OP, believing the other party had insurance, didn’t put his insurance info on the report he filed with Budget? I don’t want to speculate too much or go too far down the rabbit hole because I wasn’t there and this is a small window into the event and subsequent events. sdir asks the right question, one that I believe is the crux of the matter. Why wouldn’t they contact insurance?

  • ExplorationTravMag

    We don’t carry uninsured/underinsured on our policy because it’s also covered under comprehensive. A lot of people don’t realize the UI portion of their policy is double coverage, unless all you carry is liability. When we no longer have comprehensive on our policy, we then add UI to it, to be safe.

  • ExplorationTravMag

    The other driver was hurt in an accident caused by her? Sounds like the other driver is scamming her own insurance company… Wow.

  • John Baker

    @carverclarkfarrow:disqus Occasionally, I will take the full insurance when I don’t have the time to take 600 pictures, inspect the car with a fine tooth comb and its a short rental. I realize when I’m paying that amount, its a convenience fee like pre-paying the gas. I would agree with your first statement though.

  • jennj99738

    Just for clarification as you’re talking property damage, comprehensive coverage covers damage to your vehicle only. It may not apply here, but UM/UIM will cover for personal injury to you and your passengers when you’re involved in a collision with an uninsured or underinsured driver (no phantom vehicles). You may have med pay coverage but again, that will only cover your medical bills up to the limit and nothing for future medical expenses or any other expenses. I’m an attorney who practiced both personal injury and insurance defense litigation and I have never maintained anything less than 300k in UM/UIM coverage. State law usually provides that you can have UM/UIM coverage up to your liability limits.

  • ExplorationTravMag

    Jenn – we’re military. Tricare takes care of all that, not us. All we’re required to do is to sign off on us being military, provide a copy of our ID cards, and go on our merry way, not having to have UI/UIM. In addition, I had an accident once where the at-fault person didn’t have proper insurance. Between USAA and Tricare, the at-fault person’s life was made miserable and it’s my understanding they’re still being garnished, nearly 10 years later.

    As a civilian with no real experience dealing with military matters, I can see how you would imagine there is a blanket statement to be made here. That’s simply not the case with my family, and millions other like us. Nearly all 50 states have a provision for UI/UIM as it relates to military members, retirees and their families.

  • jennj99738

    I wasn’t just responding to you but to anyone who read your comment and thought that UM/UIM wasn’t beneficial because in my opinion as someone who has actual experience with motor vehicle accidents, UM/UIM is extraordinarily important. Sorry if that was not clear.

    In any event, your military experience wasn’t mentioned in your post. edited to remove further comment.

  • scapel@suddenlink.net

    I backed into a post
    on Maui sometimes back. When I returned the car the checking agent did not see
    the scratch. I told her there was a scratch and she still did not see it. I
    wouldn’t have made so much of it except for the possibility of the salt atmosphere
    getting under the scratch and causing damage months later. I told her it was on the back left fender and
    she still did not see it so I went and put her hand on it. OH! She says.

    I got a bill from them for $700 to replace the entire rear
    headlight. I had notified my insurance company and told them about the incident
    and sent them the pictures.

    I did not want my insurance company to pay that bill. I
    received several threatening letters and returned these threatening letters
    with threatening letters to tell them come on. We were prepared to counter sue
    for defamation of character in calling me a liar. In any event the case went
    away after several totally unnecessary communications in which I think they
    were trying to over bill my insurance company and get me to pay also.

    Budget was the agency.

  • Sickofthesame

    Wow! No one disagree with Cybersk8r, otherwise your an idiot or a rental employee.

    I rented a car with my Amex, then sure enough, had a hit and run in a parking lot. This was a 2 week rental. Because I had used Enterprise Plus points to pay for 1 DAY of the rental, Amex refused to pay, saying I hadn’t charged the ENTIRE rental to my AMEX. This advice of “never buy the CDW, your credit card will take care of everything” is so totally bogus. Credit card companies, like every other insurance company, look for any possible reason to get out of paying a claim. And yes, my personal auto insurance covered it, but after a $1,000 deductible plus all the crap the insurance co. wouldn’t pay for (loss of use, etc.), the CDW is well worth the few extra dollars.

  • jpp42

    I don’t own a car, so I don’t have my own insurance. Here in Australia, rental cars include some insurance but with a very high deductable/excess – typically about A$5500 (AUD is around parity with USD for purposes of this discussion). I’ve been purchasing travel insurance which comes with “excess reduction” to reduce the deductable to about $250. It’s much cheaper than the rental car company’s equivalent (about $15/day versus $30/day or more). Hopefully this is a good option – I’ve no idea whether the traveln insurance company will be reasonable in a claim situation.

  • Carver Clark Farrow


  • Carver Clark Farrow

    Inflammatory language aside.

    Insurance is about statistics. What is the likelihood of you getting into a car accident. Insurance companies have big brain guys figuring those numbers out. Using myself as an example. Hertz charges $9/day for Loss damage waiver, which is basically comprehensive. My regular insurance charges me about 9 Cents per day (with a $500) deductible for the same coverage. Hertz charges 100x the going rate.

    I can’t image any goods or service that are worth 100x the market rate.

  • Carver Clark Farrow

    That makes sense. Its like buying from 7-11. You’re paying a convenience charge.

  • Carver Clark Farrow

    Good point. should have qualified that I was only talking about the US.

  • Carver Clark Farrow

    When you say we were preparing to sue for defamation of character, I am curious to know who “we” are. I can’t speak for Hawaii, but traditionally, private two party communications cannot be the basis for a defamation lawsuit.

  • GeoffDepew

    I think one of the problems is that most people use rental cars on vacation, in an area that they don’t live in. When my mother had an accident – she was rear-ended in a parking lot – five years ago, it took two weeks for the police to process the police report. I had to go the police station for her (she was travelling overseas, a planned trip that started a week after the accident) and it took a half hour to get them to produce it for me. I had trouble, as I wasn’t her or part of the insurance company, and after having to travel for two and a half hours to get to the station (I don’t drive, had to go from Bergen County in NJ to Staten Island) I wasn’t happy about possibly having to come back another day.

    So if they don’t have the time to wait for the report – they’re in the area a week and leaving in a couple of days, it’ll take two weeks for the report to be ready, it’s not like they can speed the police up. They end up with no other choice. Some police departments require you to pick up the report in person, they will not send it to you. If you’re from out of the area, you’re out of luck.

  • gg

    Really? I rented a car from Hertz with CDW. Had a dent (was parked in a mall lot; not sure what happened).

    Mentioned it when I returned the car. There were no witnesses and they assured me that since I had CDW they would not charge me. Later I received a letter asking for $900 to pay for repairs and lost rentals. When preparing my final bill, Hertz had conveniently forgot to include the CDW charge. Faxed my copy of rental contract back to them. Never heard anything after that…..

  • seamigo

    Agreed. UI/UIM is very important to maintain in today’s overly litigious society.

    Information fails to mention that subrogation against the UM/UIM had occurred in her case.
    Please note for the future–perhaps not directly applicable in that particular case–that a TRICARE beneficiary who recovers money from the insurance of an at-fault driver (an insurance settlement) has an obligation to reimburse TRICARE for what TRICARE has spent on accident-related medical care.

    TRICARE doesn’t even need to notify the service member (sponsor) of this obligation. Should the beneficiary ignore the obligation, TRICARE could come after the beneficiary and/or service member personally for the money.

    See 10 USC § 1095 – “Health care services incurred on behalf of covered beneficiaries: collection from third-party payers”