Acts of nature could cost you if you rent a car

It "Hertz" to tell you this, but major car lease companies like America's largest are pass along the costs of repairing vehicles damaged by "acts of nature or God." (The words in quotation mark come from text at .)

Guess again if you think Hertz is inventing the wheel with its policy or travel a different path than its rival on this substance. "This is not new for us," points out Richard Broome, Hertz vice president of corporate affairs, in Park Ridge, N.J. "That proviso has been in our full general contract for about the past year," Broome noted. "Our rival such as endeavor have been doing this for quite some time, and now we're implementing this for all our other client as well," said Broome.

Insurance industry executives Dan Kummer and Janine Gibford weigh in with practical coverage advice. For starters, Kummer issued a cautionary message on the topic of major car lease companies that have changed their contracts to discontinue coverage of harm to vehicles caused by "acts of nature or God" such as quake or floods.

"If you don't check (lease agreements) carefully before sign language on the dotted line, you could get burned," said Kummer, director of auto insurance for the place Casualty Insurers Association of United States (PCI), an insurance trade organisation based in Des Plaines, Ill.

On the plus side, "acts of God" typically are covered under an auto insurance company's comprehensive coverage, Kummer continued. Nevertheless, Kummer urges lease car client "to make sure that you have that protection written into your contract and be sure to ask about that if you have any concerns in that area."

Whether or not you file a claim over harm caused by acts of nature, auto insurance rate addition down the road could occur because of Hurricane Katrina. "That wouldn't surprise me," acknowledged Kummer who said that all sizes and types of insurers "took massive claims hits in the aftermath of Hurricane Katrina's devastation" in Louisiana and elsewhere in the South. (Katrina in 2005 caused some $38 billion in insured property losses and reportedly produced about $1.8 billion in motor vehicle losses in the South.)

There's no shortcut to reading the rental car agreement, according to Janine Gibford, vice president of state affairs for the American Insurance Association, in Sacramento, Calif. "These contracts are often very long and not written in plain language, so that can make it difficult for the car rental customer to understand all the terms and conditions." says Gibford.

Adds Gibford: "It's a good idea to read through the contracts even though they are not exactly written for a layman's edification. If you have questions, find out from your insurance provider what coverages from your personal auto policy will extend to the rented vehicle and then ask the rental car sales representative what portion of the rental car policy covers exposures that your personal auto policy doesn't address."

Here's one last piece of advice from Gibford. "Ask the rental car company what are the coverage exclusions specified in their contract such as damage caused by acts of nature. Do not be afraid to ask questions when the rental company asks you if you want a 'collision waiver.' A 'collision waiver' is something a customer pays extra for, and you probably won't need that protection from the rental car company because that exposure probably will be covered in your personal auto policy. However, that's something you'll want to check with your insurance provider before agreeing to anything about that with the rental car company."