Rental Car Damage... in Employees Name but on Company Business

FLagent00

Expert
23
Like the title says, the client had his employee in another state on company business. They paid for the rental car using a company credit card. Unfortunately, the employee signed the rental car contract in his own name. The insurance company is denying the claim (fender bender) and saying that since the contract was in the employees personal name, insurance does not need to respond. Insurance company is strong arming us and now employee is pretty mad, understandably. We have hired auto on them... should they bother to fight the denied claim?
 
Absolutely.

What signature should the employee signed in? Realize the rental company wouldn't take anything but the employees signature and the employee (unless an officer of the company) probably isn't permitted to sign on the companies behalf.

All they should have to show is that it was in fact a company authorized rental for company business.

Now, there are some holes in the story, so lets now go back and look at what could be happening....
- Which insurance is covering this? The rental company? The credit card? Or the companies own insurance?
I assume its the companies insurance. If so, is he listed as a driver on the company policy?

If he paid by company credit card, do they cover property damage for rental cars on business? Many do, many don't. Its the cop out answer, but the name of the game is get the claim paid then worry about the rest.

----

Go back to the insurance company and have them show in the insurance policy how the claim is being denied, cite the reference. Then find something that muddies that up if it isn't already.

I also assume we are talking limited $$$ here, not a big liability claim, just a few thousand in property damage?

Dan
 
Businesses are well advised, even if they don't own any autos, to buy business auto coverage that includes "Symbol 8" coverage for liability (if not provided by Symbol 1) physical damage to hired autos. Also needed is an endorsement called the CA 20 54 which clarifies that the employee has liability coverage and that the business auto policy covers the damage to the rental car on a primary basis. If the employee has their own personal auto coverage, decent policies extend physical damage coverage to nonowned private passenger autos even if used on business. But, remember, there are lots of awful auto policies in the marketplace that provide lesser coverage.

More important, BUY THE RENTAL CAR COMPANY's LOSS DAMAGE WAIVER (LDW). Then, as long as you abide by the terms of the rental agreement (like driving on paved roads, driving sober, etc.), you're covered for about anything that happens to the vehicle, including diminished value. Almost all auto policies exclude diminished value, as do credit card coverages, but not the LDW.
 
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