I

103D CONGRESS

2D SESSION H. R. 3741

To prohibit rental car companies from imposing liability on renters with

certain exceptions, to prohibit such companies from selling collision damage waivers in connection with private passenger automobile rental agreements of not more than 30 days, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 26, 1994

Mrs. COLLINS of Illinois introduced the following bill; which was referred to

the Committee on Energy and Commerce

A BILL

To prohibit rental car companies from imposing liability on

renters with certain exceptions, to prohibit such companies from selling collision damage waivers in connection

with private passenger automobile rental agreements of

not more than 30 days, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Collision Damage

5 Waiver Act’’.

6 SEC. 2. DEFINITIONS.

7 For purposes of this Act:
2

•HR 3741 IH

1 (1) The term ‘‘rental car company’’ means any

2 person in the business of renting vehicles to the pub3 lic.

4 (2) The term ‘‘renter’’ means any person ob5 taining the use of a vehicle from a rental car com6 pany under the terms of a rental agreement.

7 (3) The term ‘‘rental agreement’’ means any

8 written agreement setting forth the terms and condi9 tions governing the use of a vehicle provided by a

10 rental car company.

11 (4) The term ‘‘damage’’ means any damage to

12 or loss of the rented vehicle, including loss of use

13 and any costs and expenses incident to the damage

14 or loss.

15 (5) The term ‘‘vehicle’’ means a motor vehicle

16 of the private passenger type (including passenger

17 vans and minivans) that are primarily intended for

18 transport of persons.

19 (6) The term ‘‘authorized driver’’ means—

20 (A) the individual to whom the vehicle is

21 rented,

22 (B) such individual’s spouse, if the spouse

23 is a licensed driver and satisfies the rental car

24 company’s minimum age requirement,
3

•HR 3741 IH

1 (C) such individual’s employer or coworker,

2 if such vehicle was rented for a business activity

3 and if such individual’s employer or coworker is

4 a licensed driver and satisfies the rental car

5 company’s minimum age requirement,

6 (D) any individual who operates the vehicle

7 during an emergency situation or while parking

8 the vehicle at a commercial establishment, or

9 (E) any individual expressly listed by the

10 rental car company on the rental agreement as

11 an authorized driver.

12 SEC. 3. PROHIBITED ACTIVITY.

13 (a) IN GENERAL.—No rental car company shall, in

14 rental agreements of 30 continuous days or less, hold any

15 authorized driver liable for any damage, except in any case

16 in which—

17 (1) the damage is caused intentionally by an

18 authorized driver or as a result of such driver’s will19 ful and wanton misconduct,

20 (2) the damage arises out of the authorized

21 driver’s operation of the vehicle while legally intoxi22 cated or under the influence of any illegal drug as

23 defined or determined under the law of the State in

24 which the damage occurred,
4

•HR 3741 IH

1 (3) the damage is caused while the authorized

2 driver is engaged in any speed contest,

3 (4) the rental transaction is based on informa4 tion supplied by the renter with the intent to de5 fraud the rental car company,

6 (5) the damage arises out of the use of the ve7 hicle while committing or otherwise engaged in a

8 criminal act in which the automobile usage is sub9 stantially related to the nature of the criminal activ10 ity,

11 (6) the damage arises out of the use of the ve12 hicle to carry individuals or property for hire, or

13 (7) the damage arises out of the use of the ve14 hicle outside of the United States or Canada unless

15 such use is specifically authorized by the rental

16 agreement.

17 (b) SECURITY DEPOSIT REQUEST PROHIBITED.—No

18 security deposit, in any form, for damage may be required

19 or requested by the rental car company during the rental

20 period or pending resolution of any dispute.

21 (c) WAIVERS PROHIBITED.—No waiver may be of22 fered or sold for any exception described in paragraphs

23 (1) through (7) of subsection (a).
5

•HR 3741 IH

1 SEC. 4. PENALTIES.

2 Any rental car company found by a court of com3 petent jurisdiction or the appropriate agency enforcing

4 this Act in any State to have violated section 3 shall be

5 subject to a civil penalty of not less than $500 nor more

6 than $1,000 for each violation.

7 SEC. 5. EFFECTIVE DATE.

8 This Act shall become effective 90 days after the date

9 of its enactment.

Æ