The admin fee is considered part of doing business and the insurance company will not pay it nor should the insured.
And- as far as diminished value-in order for the rental car company to get that money from the insurance company they have to prove that they had no other car available for a rental during that whole period of time of the repair, which they can't do, so then, again. it is dropped. If the insurance company denies diminished value, the credit card will also deny it. If for some reason the insurance company does pay something towards diminished value, then the credit car MIGHT pay something also- but that you have to look into whether or not diminished value is even covered under the credit card policy.
This is how it is handled in NY. So - if you are from NY visiting Nevada- it is YOUR policy that applies. My husband works in the auto insurance industry and works with this on a daily basis.
Going to a foreign country- we would definitely take out the rental car insurance, however.
PS- Always take a copy of your credit card insurance and travelers insurance AND even your automobile insurance ID card with you when you travel and are renting a car.
A good post, thank you.
I am not an insurance professional. I certainly would not attempt to correct a professional either. A few comments though:
Administrative fees charged during the course of accidental damage billing, are both addressed and sometimes covered by insurance policies--personal auto, credit card or other supplemental. As you say, I'm sure most insurance companies deny or reduce these charges, but I'm sure the RAC will attempt to bill the renter.
In your discussion of
'diminished value,' I sense that you were referring to
'loss of use' charges.
Loss of use charges are indeed a hotly contested charge on any damaged rental property. I should point out that both Colorado and Texas have precedent on loss-of-use charges and courts have upheld the right to such charges (Koenig v. PurCo the most famous). These charges can be made with limited documentation vs 'actual loss' documentation. Many credit card policies specifically address loss of use. Yes, I'm quite sure that most insurance companies will only consider loss-of-use charges with a adequate documentation, to include a utilization log and evidence that the vehicle was returned to service in a timely manner--if not impounded/stored for evidentiary reasons. Again, as you say, I'm sure these charges are frequently dismissed or reduced based on negotiation or lack of evidence.
To address 'diminished value,' (DV) there is broad evidence that many RAC's are pursuing DV charges against renters. Since most personal insurance and credit card policies will not pay DV charges to RAC's, the renter should expect attempts to extort such charges. Anecdotal evidence shows these are often inflated and lack any evidence of calculation. But, you could expect to see bills for such. Again, as you say, I'm sure that most of these charges are denied and only a fraction are actually paid by the renter. Of course, I'm sure quite a few people loose sleep and/or attorney fees in these cases.
While state law may affect the processing of claims against your auto insurance policy, other state laws may take precedence in determining liability and ability to recover damages etc...depending on where the car is owned, rented, operated, damaged etc... I'm sure it's very complex.
Why did I go to the trouble to write all this?
To prove that it's very litigious, complicated, inflated, worrisome and potentially costly.
I strongly agree with
mpumilia, carry copies of your insurance/coverage that you are using when renting cars, know your policy rights and limitations and do not set yourself up by intentionally/willfully violating the rental contract or terms of your insurance. I would also never rent a car internationally without full coverage and knowledge of the limitations and liabilities even with the coverage.
Too much heartache