Driving into difficulty

Issue Date: - Tuesday, 8 September 2009

Hiring a car at a holiday destination can seem like the easiest way to remove travel stress and ensure the maximum freedom to enjoy a well earned break.

However, for some visitors what appears a hassle-free plan ends up causing problems that would drive even the most laidback traveller crazy.

Commissioner for Consumer Protection, Anne Driscoll, says complaints about hire cars are a continuing source of concern. "This year confirms the pattern of on-going problems with 52 complaints received. Unfortunately the number of reports also rises during holiday periods, such as the upcoming September School Holidays."

The greatest numbers of complaints revolve around a part of the hire car contract which allows the direct debiting of credit cards to cover the alleged damage to the vehicle while it is out on hire. "It is common for consumers to only learn of the extra hefty charges when their holiday is well and truly over and they receive their credit card statement. Then it can come as quite a shock to discover an automatic deduction of hundreds and sometimes thousands of dollars to cover damage of which the consumer was often unaware."

Disputes are most often about issues such as paint and windscreen chips, dents or interior damage to the vehicle, although some relate to much more serious mechanical and body damage. These can lead to protracted unpleasant arguments that do much to diminish holiday enjoyment.

Ms Driscoll said Consumer Protection has dealt with numerous such complaints this year including one where a visitor from Victoria discovered they'd been charged $1,200 for a small stone chip on the windscreen, which was so tiny it was not picked up at inspection on returning the vehicle. Another involved a $428 credit card charge to a tourist from Wales for damage to a tyre.

Consumer problems can be compounded when a vehicle is returned to unmanned depots, like airports, where no on-the-spot inspection is carried out to ascertain the state of the vehicle at the time. The lack of inspection can result in claim and counter claim about the condition in which the vehicle was left.

"Another frequent sore point which can a involve lot of money and inconvenience is vehicle breakdowns." Ms Driscoll said

Recently in the Kimberley, Consumer Protection has dealt with complaints about breakdowns where the consumers were told they were responsible for the cost of repairs. In one case visitors had more than $2,500 debited from their credit card. The charges were levied before a mechanic had inspected the vehicle, and it turned out they were not liable. They were also left stranded and told they would have to travel up to eight hundred kilometres at their own expense to pick up another vehicle.

Similarly a consumer was charged almost $5,000 in towing fees after the vehicle broke down outside of Kalgoorlie and had to be towed to Perth.

Commissioner Driscoll said the other minefield is hire car 'insurance' known as 'collision damage waiver'. "Most often it is not true insurance but a contract about liability for damage and it certainly does not give the same level of protection that comprehensive insurance offers most drivers for their personal vehicles. Indeed many hire car operators do not actually insure their vehicles."

"Hire car collision damage waiver terms can have unusual exclusions including not providing coverage when it is a single vehicle accident; under body damage; animals are hit; tree branches fall on the vehicle or if a vehicle is involved in a rollover. Most consumers would assume that these events would be covered by the hire car 'insurance' but they are not", Ms Driscoll said.

In one complaint this year a consumer was charged $3,781 following an accident with a kangaroo. Though they had paid an additional fee to reduce their 'insurance' excess it turned out this cover did not apply to any single vehicle accidents. "In other words, if a claim can not be made against someone else then the hirer is responsible. Skippy was clearly not insured." clearly not insured!

"While most car hire companies are reputable and act fairly there is an element which needs to clean up its act."

Commissioner Driscoll said some disputes bordered on the absurd, such as where 12 people hired a bus and luggage trailer to go on holiday. "All details specified vehicle to take diesel fuel only. The tag on key ring and documentation stated diesel only. After filling the vehicle with diesel it broke down as the motor was actually a petrol engine. The consumers were initially charged $355 for the repairs."

"The terms and conditions of contracts involved in vehicle hire are heavily weighted in favour of the companies and consumers need to know their rights."

Consumer Protection advises, when considering hire cars and insurance, consumers should:

not let price be the only consideration;
try to get the terms and conditions when booking – if possible get the contract sent in advance;
take their time and read the contract carefully and ask questions if unsure;
find out what types of damage or loss are covered by exclusions and what exclusions and excesses apply;
carefully examine the vehicle for existing damage before departing;
by preference return the vehicle to a rental station during normal trading hours to ensure it is inspected and an 'accurate' report on the condition obtained;
take date and time stamped photographs showing the condition of the vehicle especially when returning it to an unmanned depot;
ensure they understand any special conditions like not travelling on an unsealed road, beaches and geographical restrictions such as beyond the 26th parallel; and
take special care when driving. By the very nature of hiring an unfamiliar car in an unusual setting, drivers are faced with different driving conditions like long distances, high speeds on country roads, gravel shoulders and wildlife. A recipe for the unexpected to occur.

Finally if consumers feel their credit card has been unjustly debited or they have been charged for breach of contract they should approach their financial institution and lodge a complaint with Consumer Protection.

End of Release

Media Contact: Rick Powell, Media Liaison Tel 92820961 Mob 0412 405 936