discount car rental lax

The Utah Supreme Court has ruled that car rental companies must carry basic liability insurance on all of their vehicles, up to $25,000, and cannot substitute that insurance with a customer’s personal auto insurance.

In a ruling issued Tuesday, the court said Utah law was clear that all car rental companies must carry basic liability coverage regardless of whether customers have auto coverage of their own or not.

The ruling stems from the case of a July 2000 fatal auto accident in which the victim’s surviving estate and family sued Enterprise Rent-A-Car plus several insurance carriers.

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The estate of Beizhong Li included Enterprise in its suit for its $25,000 insurance policy, which the estate claimed was required by Utah law. However, attorneys for Enterprise pointed out that Li had waived coverage by initialing a box on his rental agreement, declining the “optional” liability protection because he had personal automobile insurance.

A district court judge dismissed Enterprise from the suit, finding that Utah law allows car rental companies an exception if customers have insurance of their own. However, the Utah Court of Appeals overturned that decision, holding that Utah law requires car rental companies to insure their vehicles while they are on the highways. The appellate court also found that the section in Utah law that appeared to have an exception did not excuse companies from coverage but only prioritized insurance policies.

In its opinion, the Utah Supreme Court agreed with the court of appeals, saying it was clear the Utah Legislature “did not intend the availability of other valid or collectible insurance coverage to excuse rental car companies from maintaining insurance coverage on their vehicles in accordance with the requirements of Utah’s Financial Responsibility of Motor Vehicle Owners and Operations Act.”

E-mail: gfattah@desnews.com

discount car rental lax