'Reimbursement Policy' Fails to Meet Requirements of the Law

I have a friend who is a professional photographer. I will call him Bill.  Bill owns a full-size, four-wheel-drive utility vehicle that he uses to transport his equipment and reach the remote locations sometimes required by his job.

Several months ago, Bill was involved in an accident while driving his truck. The other driver was entirely at fault.  No one was injured in the accident, but Bill's vehicle required nearly $4,000 in repairs.

While his truck was being repaired, Bill rented a small sedan and paid $18.99 a day plus tax for eight days.

Bill could not get all his equipment in this small rental car. To avoid the expense of a larger vehicle, however, he scheduled his work to reduce the amount of equipment he would need to transport during this time. After returning the rental car, Bill submitted his paid receipt for $175.23 to the other driver’s insurance company

Bill received the following written reply: "Regarding the rental billing, our reimbursement policy is $16.95 per day plus applicable tax.”  The insurance company refused to pay more, although the charges Bill had incurred were reasonable, had already been paid and represented rates for a vehicle much less expensive than Bill's damaged one.

This insurance company's policy is contrary to the law. As a general rule, if the other driver caused the accident and your car is being repaired, you are entitled to compensation for the loss of use of your car. The value for this loss most often is measured by the rental cost for a similar vehicle.

The other driver or his insurance company must pay this expense. If your new Cadillac is damaged, you are legally entitled to be compensated for the loss of new Cadillac. You need not accept compact car rental rates as the measure of your loss.

Bill rented an economy car to replace his more expensive utility vehicle, but the insurance company still refused to reimburse him fully.

Bill either will lose money or be forced to file a lawsuit. For approximately $20, a lawsuit is not really an option. Bill wonders how many others have been affected by this "reimbursement policy.”