§ 516D.4 — Damage or loss — collision damage waiver

Iowa § 516D.4

• Jurisdiction: Iowa
• Title XIII: COMMERCE
• Ch. 516D: RENTAL OF MOTOR VEHICLES

Text

1. a. A rental company shall not hold, or attempt to hold, an authorized driver liable for
physical damage to a rental vehicle, loss due to theft of a rental vehicle, or damages resulting
from the loss of use of a rental vehicle, unless the rental company offers the customer a
3 RENTAL OF MOTOR VEHICLES, §516D.4
collision damage waiver under the terms and conditions described in subsection 2, or unless
one or more of the following applies:
(1) The damage or loss is caused intentionally by an authorized driver or is a result of the
authorized driver’s willful, abusive, reckless, or wanton misconduct.
(2) The damage or loss arises out of the authorized driver’s operation of the rental vehicle
while intoxicated or under the influence of a drug.
(3) The damage or loss is caused while the authorized driver is engaged in a race, training
activity, contest, or use of the rental vehicle for an illegal purpose.
(4) The rental agreement is based on false or misleading information supplied by the
customer or an authorized driver.
(5) The damage or loss is caused by operating the rental vehicle other than on regularly
maintained hard surface roadways, including private driveways and parking lots.
(6) The damage or loss arises out of the use of the rental vehicle to transport persons or
property for hire or to push or tow anything.
(7) The damage or loss occurs while the rental vehicle is operated by a driver other than
an authorized driver.
(8) The damage or loss arises out of the use of the rental vehicle outside the continental
United States unless such use is specifically authorized by the rental agreement.
(9) The damage or loss is attributable to theft which occurs with the prior knowledge or
knowingparticipationofanauthorizeddriver,orwhichisattributabletotheauthorizeddriver
leaving the rental vehicle unattended with the keys in the rental vehicle.
b. This section does not alter the liability of a customer or authorized driver for bodily
injury or the death of another and for property damage other than to the rental vehicle in
accordance with the rental agreement. This section does not prohibit a rental company
from accepting or negotiating master contracts with companies or government entities in
advance of need whereby the companies or government entities specifically agree to assume
liability in exchange for rate concessions. This section does not prohibit a rental company
from entering into agreements with insurance companies to provide replacement vehicles to
insurance company customers whereby the insurance company agrees to assume the risk
of loss.
c. If the rental vehicle is not repaired, damages shall not exceed the fair market value of
thevehicle, asdeterminedinthecustomarymarketforthatvehicle, lesssalvageoractualsale
value, plus additional license and tax fees incurred because of the sale, plus administrative
fees. A claim shall not be made for loss of use if the rental vehicle is not repaired.
2. a. A rental company may offer a collision damage waiver under the following terms
and conditions:
(1) All restrictions, conditions, and exclusions must be printed in the rental agreement,
or on a separate sheet or document, in ten point type, or larger; or written in pen and ink
or typewritten in or on the face of the rental agreement in a blank space provided for such
restrictions, conditions, and exclusions. The rental agreement may provide that the collision
damage waiver may be voided under the conditions set forth in subsection 1, paragraph “a”,
subparagraphs (1) through (9).
(2) The rental agreement, separate sheet, or document must clearly and conspicuously
state both the daily and estimated total charge for the collision damage waiver.
(3) (a) The rental agreement, separate sheet, or document given to the customer prior
to entering into the rental agreement must display in ten point type, or larger, the following
notice:
NOTICE: This contract offers, for an additional charge, a
collision damage waiver to cover all or part of your responsibility
for damage to the rental vehicle.
Before deciding whether to purchase the collision damage
waiver, you may wish to determine whether your own automobile
insurance affords you coverage for damage to the rental vehicle and
the amount of the deductible under your own insurance coverage.
§516D.4, RENTAL OF MOTOR VEHICLES 4
The purchase of this collision damage waiver is not mandatory and
may be declined.
(b) The customer must separately acknowledge that the customer received the above
notice, that the customer desires to purchase the collision damage waiver, and the terms of
the collision damage waiver to which the customer agrees.
(4) The car rental company shall not pay commissions to a rental counter agent or
representative for selling collision damage waivers and is prohibited from considering
volume of sales of collision damage waivers in an employee evaluation or determination of
promotion.
b. However, notwithstanding whether a rental company offers a collision damage waiver
undertheprovisionsofthissubsection,therentalcompanyshallnotholdanauthorizeddriver
liablefordamageorlossduetotheftexceptwheresubsection1, paragraph“a”, subparagraph
(9) applies.