The car rental industry has picked up since the lifting of COVID lockdowns. The car rental industry in the United States has grown 2.8 percent annually from 2017 to 2022, with a revenue of $54.2 billion in 2022. If you’re planning to rent a car on your upcoming vacation, it would be good to know what to expect from car rental and insurance companies. For example, are car rental companies liable in a car accident claim? According to the Graves Amendment, car rental companies do not share liability for the damages when their car has been involved in an accident.
What is the Graves Amendment?
The Graves Amendment (49 U.S. Code § 30106) is a federal law that states that car rental companies cannot be sued by accident victims for any injury that they have sustained during the accident. Enacted in 2005, it bars vicarious liability for rental companies and supersedes any State law. That means, no matter where you are in the US, the Graves Amendment makes sure that you cannot sue a car rental company for liability claims caused by reckless driving.
How Does The Graves Amendment Affect Michigan Drivers?
Prior to 2005, car rental companies shared liability for car accidents that their customers caused. This means that an accident victim (or a family member, in case of the victim’s death) can file the accident claim both with the car rental company and the driver who rented the car. However, the Graves Amendment virtually eliminated this liability claim against car rental companies.
Are Car Rental Companies Liable For Drivers Using Their Cars?
If the car accident was caused by someone using a rented car, the car rental company will not share liability for the accident claim. The liable party would be the rental car driver who caused the accident through recklessness or negligence. In this case, you can file the car accident claim with the driver or their insurance company. Here, the car rental company will not be held liable in any way.
When Can a Car Rental Company Be Held Liable in a Car Accident Claim?
Most situations exempt car rental companies from sharing liability in a car accident claim. However, there are instances when they can be held liable because the company’s negligence caused the injuries or accident. Examples of this include:
- Negligent maintenance. Failure to keep the vehicle in top condition, resulting in worn brakes and other faulty parts. Whether intentional (to cut costs) or otherwise, negligence is a ground for car rental companies to share liability in an accident claim.
- Negligent entrustment. When a car rental company rents out a car, knowing it is poorly maintained and has a mechanical problem, they can be held liable for the accident that this has caused. Most of the time, these companies will try to use the Graves Amendment as a defense. This is why you should have an experienced car accident lawyer by your side who will help you to prove their liability.
How Can You Recover Damages From a Car Accident?
As a no-fault state, Michigan requires drivers to have personal injury protection (PIP) insurance. Also called no-fault auto insurance, it covers medical expenses both for you and your passengers if you were involved in a car accident, regardless of who is at fault.
This no-fault insurance will pay for injuries to people and for the damage that your car does to other people’s property, including properly parked vehicles. For example, a no-fault insurance policy can pay a person who is injured or killed in an accident up to $20,000 and can cover property damage up to $100,000.
If the damages exceed your PIP insurance policy’s limits, you can file a car accident claim with the at-fault driver’s insurance company.
Let The Clark Law Office Help With Your Car Accident Claim
An experienced car accident lawyer can help you receive compensation if you have been in an accident. The Clark Law Office has been serving clients in Michigan for 30 years, successfully recovering millions of dollars for their clients.
As a personal injury law firm, we specialize in car, motorcycle and truck accidents, dog bites, worker’s compensation, slip and fall, medical malpractice, wrongful deaths, and birth injuries. To know more about how we can help you, call +1 (517) 347-6900 today. You can also email us at email@example.com
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