The Graves Amendment and Rental Car Liability

If you’ve ever had a vehicle accident in a rented vehicle, you might wonder who’s responsible. Before 2005, rental car companies could be held legally responsible for accidents caused by the person driving their vehicle. But this shifted with the passage of the Graves Amendment. Now, in most cases, the at-fault driver’s insurance covers damages, not the rental company.

This article explains how the Graves Amendment limits rental car company liability for accidents involving their vehicles. You’ll learn what this means for both drivers and rental car companies.

A car accident attorney near you can also offer legal advice targeted to your accident and recommend next steps.

The Basics of the Graves Amendment

The Graves Amendment (found in 49 U.S.C. § 30106) is a federal law that Congress created as part of a federal highway bill in 2005. This rule is about the applicability of vicarious liability. It states rental car companies and those involved in leasing can’t be blamed for accidents just because they own or lease the motor vehicle.

To pin the blame on leasing companies or car rental firms:

The Renter Must Show the Company’s Negligence Led to the Mishap

Imagine you rent a car, but the brakes don’t work, and you wreck. If the rental place knew about the bad brakes or didn’t check them as they should have, that’s called negligent maintenance. It means they didn’t properly care for the car, which led to your accident.

Let’s say someone wants to rent a super-fast racecar. But they’ve never driven a car before, and they don’t have a driver’s license. If the rental place gives them the car anyway, that’s negligent entrustment. It means the company made a bad choice by letting someone without experience or a license drive a dangerous car.

There Should Be Evidence of Criminal Wrongdoing on the Part of the Owner of the Motor Vehicle

This one’s a bit simpler. It means that if the owner of the car rental company did something illegal with the car (or allowed something illegal to happen), they could be in trouble. For example, if they know the car was used in a robbery and didn’t report it to the police, that’s evidence of criminal wrongdoing.

In both situations, the idea is the same. If the rental place or the owner did something wrong (either by failing to maintain the vehicle or doing something illegal), they can be held responsible.

What This Means for the Driver

If you’re in a car accident while driving a rental vehicle:

• The insurance company of the person at fault (often the rental car driver) generally pays. They would use their insurance policy to ensure the insurance coverage meets insurance requirements.
• The owner of the vehicle, if found negligent, might be held responsible for personal injury or property damage.

Different states, like Florida or New York, can have varying state laws regarding this. So, always verify your insurance coverage and be aware of liability insurance norms.

Final Tips For Rental Car Companies or Lessors

• If you’re involved in leasing motor vehicles, know that this law affects you.
• Lessors, those who handle leasing, should be particularly informed about this. Being informed ensures you’re not unfairly held responsible for accidents you didn’t cause.
• Leasing companies or even a dealership that gives a loaner could come under this law. If someone has an accident with a leased car or a dealership loaner, the Graves Amendment can determine who is responsible for the damages.
• For any doubts, seeking legal advice is wise. Talk to a car accident lawyer. They can clarify financial responsibility after an accident.
• If you’re ever in a rental car accident, keep your driver’s license handy and ensure your driving record is clean.

Find an Attorney To Help With a Rental Car Accident

This information is broad. For detailed insights, especially about liability laws, consult with an injury attorney. FindLaw’s directory of personal injury attorneys can connect you with qualified legal advisors in your area. Select your state or city to review contact and ratings information for local experts. Your search results will also link you to additional details about the attorneys’ experience with rental car accidents.