OT - When does a rental car become a stolen vehicle?

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I'm going to be renting a car for a family vacation. I am trying to find the cheapest way to add my wife and 2 sons as operators and ensure that our private insurance will cover any accidents regardless of who is driving.
In order to add 3 Additional Authorized Operators (AAO), the rental company wants an extra $24/day for the 10 day trip, and that's with a considerable discount.
I asked my insurance company what would would happen if I didn't add them to the contract and one of them was involved in an accident. The answer was:
"Well that is a hypothetical situation that I can not answer directly. All I can say is that from a policy perspective they would be covered, but from a legal perspective they might not be."
That was the best that I could get out of her since it was a "hypothetical situation".
So I called the rental agency and ran it by them. The rental agent was a bit more forthcoming.
"Your auto insurance policy coverage extends to any operator that you authorize to operate a covered vehicle and your coverage also extends to rental vehicles. Therefore, if you authorize someone to operate the rental vehicle, they would be covered by your insurance.
However, in a worst case scenario, if an operator who is not listed as an AAO with the rental agency has an accident, the rental agency has the option to consider the contract null and void, which essentially turns the vehicle into a stolen car. Since it would no longer be a rental vehicle, but technically a vehicle involved in a crime, it might not be covered by your policy."
He did mention that something like that has not happened, to his knowledge, in a long, long time, but in a worst case scenario, it could. He added that, hypothetically, it was up to me if I wanted to take that chance.
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Well, it did seem to flow smoothly from the Ins Co rep saying that there might be a "legal" issue with coverage to the rental agent explaining it in a way that took "policy coverage" out and brought the "legal status" of the vehicle in.
I had not mentioned the Ins Co comment to the rental agent until after he explained the stolen vehicle matter. After I did he said (paraphrasing) "That's why she couldn't answer the question directly. It would be up to the rental agency to first deem the contract null and void which would remove the "rental status" from the vehicle, at which point it would no longer be covered. Until that happens, the Ins Co would have to cover it."
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They can probably deem PARTS of the contract null and void. They most likely can't deem the whole thing void and prevail. Just because someone breeches part of a contract usually doesn't meant the whole thing goes out the window.
What they can't do is turn it into a stolen car, because it's not. IMO, it doesn't even meet the level of "unauthorized use", which is a lesser crime involving a car. In most cases to convict on that you have to show that the person KNEW they did not have the permission of the owner. Easy defense is, "Dad was paying the rental company and I thought I was authorized." Isn't a jury in the US that would convict, either.
I predict this thread will quickly exceed the # of posts in the thread about that failing apart door.....
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wrote:

...
Are we counting posts in just the latest "Sagging Door" thread or will we be combining the posts from all three related threads?
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snipped-for-privacy@optonline.net wrote:

I agree with the probable outcome, if caught.
But is this something you want to teach the kids? That it's okay to 'bend' the rules to save some money? Are you going to be able to relax while they are out driving in it, and you didn't list them as drivers? What if they end up in the pokey until you are dragged down there to sort it out?
Or is this just hypothetical?
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Oren wrote:

It becomes void when an unlisted driver, drives it! That's what the contract says: "who the hell *exactly* is going to be driving this thing?"

Possession is 9/10ths of the law ;-)
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DerbyDad03 wrote:

Because the second a non-additional driver moves an inch behind the wheel, and you the contracted allowed it - the contract is broken right then.
It's a contract, it does not get broken when or if you get *caught*, it gets broken when an actor goes against the agreement. Even if the car is returned uneventfully, you still broke the contract. The rental company won't know it, but you will and so will your family. Kinda a slippery slope in the financial, legal, and moral aspects.
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So what? It's a breech of contract, which is a civil matter. Last time I checked, just because someone breeches a contract does not give the police the right to impound a vehicle. If that were the case, the cops would be doing all the work for finance companies when the people who finance a car fail to make payments.
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wrote:

There is a difference between being the registered owner of a vehicle with a financial lien against its title (i.e. why a financing company would be involved) which would be entirely a civil matter unless some intent to defraud the financing company could be proven against the registered owner of said vehicle...
And the situation where you are merely a contracted user of a vehicle owned by someone else (the rental company)... The police can refuse to allow you to retake possession of such a vehicle after a traffic stop or accident (in both situations your vehicle is considered to be seized by the police during the duration of the incident unless and until the police release custody of it back to the legal owner or someone the legal owner designates) and why would the police trust an authorized user of a rental car who allowed someone not authorized to operate the vehicle and it was either involved in a traffic accident or violated traffic laws to continue to be honest and only allow the authorized users to operate it when the fact that it was stopped or crashed with someone else driving it say otherwise... Impound and allow the legal owner to come collect it is the typical police mindset on such things...
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It's still a breech of contract, plain and simple. The fact that the police MIGHT impound the car because the unlisted driver might not be able to prove that they are authorized to drive the car, doesn't change that. From a practical matter, I seriously doubt if the car was rented to Derby and the cops find his son driving it that they are going to waste their time on this nonsense.
And next, when a contract is breeched, it doesn't suddenly become a no-mans wilderness. The procedure is simple. If the party that believes they were damaged by the breech wants to pursue it, they can sue. Then they have to prove:
A - The contract was breeched by the other party.
B - Damages.
I'm still waiting to hear in all this what the damages to the rental company are specifc to Derby allowing an unlisted driver to use the car. If he returns the car without any problems, no damages. He wrecks the car himself, he and/or his insurance company are responsible. The unlisted driver wrecks the car, Derby and/or his insurance company and the unlised driver are responsible. Same thing.
The only "damages" here I can see are the insurance company is out the additional fee they were entitled to for the additional driver. If they want to go after Derby for $25, that is their case. BFD.
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On 07/21/12 10:50 PM, snipped-for-privacy@optonline.net wrote:

Perhaps we should all keep the bigger picture in mind:
An accident.
It seems a waste of time to discuss the "monetary damages" of the fee that didn't get paid if an operator isn't listed.
It seems a waste of time to discuss the issue of an unlisted operator gets pulled over by the police and the car getting impounded. Even on the off chance that that happens, I don't see the monetary consequences being substantial.
The only real monetary issue that matters is whether an Ins Co would pay for damages if that unlisted operator is involved in an accident.
Since my Ins Co has said that there might be legal issues that would prevent them from covering an unlisted operator it's not worth trying to save a few hundred on the rental contract by not listing all drivers.
Once again, I keep going back to this:
My Ins Co makes no money if I list the drivers or not. In fact, it will cost them money if a listed operator is involved in an accident. So why would they tell me to make sure I list all operators?
Since they don't make any money by telling me to list all Operators, but may indeed have to pay out, the only reasonable conclusion is that there is in fact a legal way for them to get out of paying for the accident and they are trying to protect me, their customer, from a huge debt.
In other words, they are doing the right thing.
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I agree, but someone else brought up the issue of damages to the rental car company by you not listing the other drivers. And being out that money is the only damage I can see. That was why I went there.

I agree. But it is an example of where the unlisted driver and you could wind up with some additional expenses, if the car got pulled over and impounded.

I agree.

But from what you have told us the insurance company said, they didn't say that. They said "All I can say is that from a policy perspective they would be covered, but from a legal perspective they might not be."
Which isn't clear at all. If the insurance company believes they might not be covered then you would expect them to say "They might not be covered", period. And the freaking insurance company should know as this must come up frequently. It's not some highly improbable hypothetical.

Did the actually say those words? And if they did, the reasons could be that they don't want to encourage you to cheat the rental car company. And they know that like we've discussed here, there are other possibilities where you might be out time, money etc, ie that traffic stop scenario.

I don't understand that reasoning. If they are indeed interested in protecting you, all they have to do is cover the other driver, whether listed or not. Instead they gave you some jumbled up crap. Probably because whoever you got to doesn't know the real answer. And surely they do because this has to happen all the time.

The right thing in my book would be to cover you regardless of whether you listed them or not, provided they are otherwise a licensed driver. I mean, suppose at the counter the rental person forgets to ask about additional drivers? What happens then if you later let someone otherwise authorized drive the car and they kill a nun? Your insurance company just says, too bad? At the same time, insurance companies will pay out if a listed driver gets drunk, goes 90mph and kills the nun? MAkes no sense to me.
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The reasoning is quite easy to understand, at least to me.
You are speculating that the person I talked to, a person my question was escalated to when the 1st level customer service rep didn't know that answer, also didn't know the answer.
I condensed a much longer conversation down to just few lines in my OP. Since I spend a lot of time dealing with customer service departments from many, many companies, including my own, I'm pretty good at being able to tell when the rep is making stuff up as they go along vs. when they actually know what they are talking about.
I choose to speculate that she actually did know the answer to my question and that it is this: She knows that in certain situations the lawyers for the Ins Co can step in and tell the claims department to deny the claim. Since, as you say, this happens all the time, then she may very well be aware that in certain situations unlisted operators of rental vehicles are denied coverage. However, unless it was an actual case where all the details are known as opposed to a very simple hypothetical situation (e.g. No other details were discussed other than an unlisted operator being involved in an accident) she can't say with 100% certainty that my simple hypothetical situation would be covered or not.
So she does the right thing and advices me to have all operators listed. This advice gives me a much higher chance of every incident being covered and less chance of the lawyers overriding the claims department due to an unauthorized operator.
Look, everything here is hypothetical and unless we're all sitting around a table with knowledgeable representatives from the Ins Co and rental agency, and probably a few lawyers too, discussing the exact details of a specific incident, we'll never resolve these questions.
The easiest and safest thing for me to do is to simply list and pay for any and all operators that might be reasonably expected to operate the vehicle while under contract.
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On Fri, 20 Jul 2012 11:51:59 -0700 (PDT), DerbyDad03

If you have "non owned vehicle coverage" from your insurer, you don't need to buy insurance from the rental company - and if your coverage covers all of your drivers as named insured on YOUR vehicles, they are all covered on the "non owned" as well.
Good luck to the insurance company claiming it is a "stolen vehicle" unless it is not returned at the end of the rental agreement - whether in 1 piece or 10.
In Ontario anyway. No idea how those things work in Yankee-Land
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We know that.
> and if your

That's part of the issue. My sons are not named on my policy.

It would not be the Ins Co claiming it was "stolen", it would be the rental agency. At that point the Ins Co *could* say "The operator at the time is not our customer and he was not authorized by the rental company to operate the vehicle that our customer contracted, therefore we are not going to cover the incident.

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On Fri, 20 Jul 2012 12:41:39 -0700 (PDT), DerbyDad03

That is correct, if you, the contract holder, is not in the car. The police have no way of knowing the car is not stolen and the driver is authorized to use it, insured or not. The contract states Bob is the authorized driver. Tom, however has the car, but no evidence the rental company is allowing his to drive it. Quick call to the rental company confirms Bob is the driver and they have no idea who Tom is.
It may turn out ok, but can be a PITA until you do.
If that person is in an accident, insurance coverage is OK, assuming usual terms and they are a policy holder, etc. .
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On Fri, 20 Jul 2012 12:41:39 -0700 (PDT), DerbyDad03

Daughter's boyfriend got a call 4 montha ago from the local Law Enforcement Agency - "do you own a 2005 Chrysler 300?" He said yes. They asked where it was. He said on the driveway. They said "You better check". It wasn't there. It was found in an adjoining city, wrecked and burning. He had both sets of keys
He had made the mistake of dealing with a BANK instead of an insurance company for his insurance. He had full coverage, babied the car - it was like brand new- and they are still dragging their feet about paying. They have both police departments chasing their tails investigating - sounds like they are trying to prove he HAD it stolen, or wrecked and burned it himself. At any rate, they are trying REAL HARD to get out of paying for the loss!!!
Meanwhile he's still making car payments (different bank than the company insuring it) and he's driving my wife's old car which we were going to scrap when we bought her latest one - a few weeks after his loss. He paid for renewing the plates, and is covering our out of pocket insurance costs - my daughter being an insurance broker we made sure he is on as the primary driver.
He'll deal with a broker next time!!!

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Yes, the legal reason is that you as the contracted (rental) user of the vehicle do not have legal authority to determine who can and can not use the vehicle, only its owner, the rental company can do that...
That is why all persons who will or could be driving the rental vehicle should be listed as additional authorized operators... There are different laws in different states but since you are not the legal registered owner of the vehicle your decisions and directives as far as who can use it are meaningless...
It is a crime of varying severity to be operating a motor vehicle without authority and connected to it are various offenses such as uninsured operation of a motor vehicle -- as if you are not authorized by the owner to operate it and have no proof available at the scene of the accident/traffic stop to prove you have specific insurance coverage for that driver on that vehicle it is big trouble...
The police can impound the car since if they come upon it involved in an accident or stop it for a traffic offense and it is ot being operated by an authorized user as described on the contract then it is evidence related to the criminal infractions and why would the police want to allow the authorized operator (even if they were present) the continued ability to commit additional fraud against the owner...
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Derby told you in the original post that his insurance company told him he is in fact covered if he allows an unlisted driver to use the car. You claimed he could not have such a policy and that such a policy is prohibitively expensive. Derby reaffirmed that he does in fact have that coverage. Now, who should we believe? Derby who talked to his insurance company, or you?
As for it being a crime, I think you'd have a hell of a time getting a prosecutor to pursue this nonsense. And an almost impossible job getting a conviction. It might be theoretically possible, but at the end of the day, the only "crime" here is that the rental car company did not get their additonal small fee of a few bucks a day for adding the driver. It's not like someone going over to a relatives house at night and taking their car on a joyride for a week. THAT is what unauthorized use laws are there for.

Yes, that's true. And so far, despite all the attempts to make this into something worse, that's the only POSSIBLE downside I see. And if the cops pull over son Little Derby in that rental, he has the rental contract that shows it was rented to Big Daddy Derby, I submit there ain't a cop in a thousand miles that's gonna waste his time on this horse shit. You remind me of Barney Fife.
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Now, hold on T, let's make we all understand what my Ins Co told me.
As I said in my OP and repeated a few times in various posts:
From an insurance policy perspective, I and all drivers I authorize to drive my covered vehicles are covered. However, from a *legal* perspective there may be situations in which such coverage could be denied.
While I hate to agree with Evan, I believe that he is saying more or less the same thing I said earlier:
I have no authority to authorize additional drivers on a rental vehicle. All that I have is the option of asking the rental agency to list them as Additional Authorized Operators. If the rental agency deems them worthy, then they - the rental agency - will authorize them. At that point my policy will cover them.
I can't say for sure, but that may be the legal loophole that the Ins Co rep hinted at.
In any case it really doesn't matter since I'm going to list any and all drivers that I expect will drive the vehicle during the rental period.
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