Protect Renters of Rental Cars

Section 1. Section 396-z of the general business law, as amended by chapter 731 of the laws of 2006, is amended to read as follows:

§ 396-z. Rental vehicle protections. 1. For the purposes of this section: (a) "Authorized driver" [shall mean] means: (i) the person to whom the vehicle is rented if a licensed driver; (ii) such person's spouse if licensed and at least eighteen years of age; (iii) any person who operates the vehicle during an emergency situation to a medical facility; or (iv) any licensed driver expressly listed on the rental agreement as an authorized driver.

EXPLANATION--Matter in italics (underscored) is new; matter in brackets

[ ] is old law to be omitted.

LBD08643-20-8

A. 5270--C 2

(b) "Rental agreement" means any written agreement setting forth terms and conditions governing the renter's or any authorized driver's use of a rental vehicle[, as defined in section one hundred thirty-seven-a of the vehicle and traffic law,] for a period not to exceed thirty continuous days.

(c) "Rental vehicle company" means any person or organization, or any subsidiary or affiliate, including a franchisee, in the business of providing rental vehicles to the public from locations in this state.

(d) "Optional vehicle protection" means a rental vehicle company's agreement not to hold an authorized driver liable for all or part of any damage or loss to the rented vehicle, any loss of use of the rented vehicle, or any storage, impound, towing or administrative charges for which [the] an authorized driver may be liable. The term "optional vehicle protection" shall encompass within its meaning other similar terms that may be used by rental vehicle companies, such as but not limited to "Collision Damage Waiver", "CDW", "Damage Waiver", "Loss Damage Waiver", "LDW", and "Physical Damage Waiver".

(e) "Renter" means a person or entity that obtains the use of a [private passenger] rental vehicle from a rental vehicle company under terms of a rental agreement.

(f) "Consolidated facilities charge" means the allowable recovery by a rental vehicle company from its renters of those fees, including any taxes or fees paid on such fees, for the finance, design, construction and operation of consolidated airport facilities and or the finance, design, construction and operation of common use transportation systems that move passengers between airport terminals and [those] consolidated airport car rental facilities. The aggregate amount to be collected shall not exceed the reasonable costs, as determined annually by an independent audit paid for by the airport operator or its governing entity, to finance, design, construct and operate those facilities and common use transportation systems. The consolidated [facility] facilities charge shall apply only to vehicle rentals occurring at vehicle rental locations subject to the imposition of such charge by an airport operator or its governing entity. The term "consolidated facilities charge" shall encompass within its meaning other similar terms that may be used by airport authorities or rental vehicle companies, such as, but not limited to "customer facility charge" and "transportation facility charge".

(g) "Concession recovery fee" means the allowable recovery by a rental vehicle company from its renters of those fees, including any taxes or fees paid on such fees, which an airport operator or its governing entity imposes on a rental vehicle company's applicable revenues or rental transactions, as defined and stated in a concession agreement that authorizes a rental vehicle company to operate at an airport located in this state. The concession recovery fee shall apply only to vehicle rentals occurring at vehicle rental locations subject to the imposition of such fee by an airport operator or its governing entity. The term "concession recovery fee" shall encompass within its meaning other similar terms that may be used by airport authorities or rental vehicle companies, such as, but not limited to, "concession fee", "concession recovery fee surcharge", "privilege fee" and "airport access fee".

(h) "Airport fees" means [the] consolidated [facility charge] facilities charges and/or [the] concession recovery [fee as those terms are defined herein] fees.

(i) "Concession agreement" means an agreement, permit or license entered into between an airport operator or its governing entity and

A. 5270--C 3

rental vehicle company setting forth the terms and conditions under which the rental vehicle company may transact its rental business at such airport.

(j) "Consolidated airport facilities" means those buildings or physical structures, including, but not limited to, parking garages, parking areas and fueling systems, constructed by or on behalf of the airport operator or its governing entity to be jointly used by all rental vehicle companies operating at such airport pursuant to a concession agreement.

(k) "Rental vehicle" means a rental vehicle as defined in section one hundred thirty-seven-a of the vehicle and traffic law, but excluding motor vehicles designed primarily for the transportation of property.

(l) "Manufacturer's suggested retail price" means the retail price of the motor vehicle suggested by the manufacturer in accordance with the requirements of federal law.

2. (a) A rental vehicle company shall not charge more than [nine dollars] the following amounts per full or partial twenty-four hour rental day for optional vehicle protection [if the manufacturer's suggested retail price of the rental vehicle is not greater than thirty thousand dollars. A rental vehicle company shall not charge more than twelve dollars per full or partial twenty-four hour rental day for optional vehicle protection]:

(i) nine dollars if the manufacturer's suggested retail price of the rental vehicle is not greater than [thirty] twenty thousand dollars;

(ii) twelve dollars if the manufacturer's suggested retail price of the rental vehicle is greater than twenty thousand dollars but not greater than thirty-five thousand dollars;

(iii) fifteen dollars if the manufacturer's suggested retail price of the rental vehicle is greater than thirty-five thousand dollars but not greater than fifty thousand dollars; and

(iv) the amount that may be charged for a vehicle with a manufacturer's suggested value of greater than fifty thousand dollars shall not be subject to a maximum dollar amount but shall be subject to the fair market value as determined by the rental vehicle company.

(b) A rental vehicle company shall not sell optional vehicle protection unless the [authorized driver] renter agrees to the purchase of such protection in writing at or prior to the time the rental agreement is executed.

(c) A rental vehicle company shall not void optional vehicle protection except for one or more of the following reasons:

(i) The damage or loss is caused intentionally or as a result of willful, wanton, or reckless conduct of the driver[.];

(ii) The damage or loss arises out of the driver's operation of the vehicle while intoxicated or unlawfully impaired by the use of alcohol or drugs[.];

(iii) The rental vehicle company entered into the rental transaction based on fraudulent or materially false information supplied by the renter or authorized driver[.];

(iv) The damage or loss arises out of the use of the vehicle while engaged in the commission of a crime other than a traffic infraction[.];

(v) The damage or loss arises out of the use of the vehicle to carry persons or property for hire, to push or tow anything, while engaged in a speed contest, operating off road, or for driver's training[.];

(vi) The damage or loss arises out of the use of the vehicle by a person other than: (1) an authorized driver; [a duly licensed parent or child over the age of eighteen thereof who permanently resides in the

A. 5270--C 4

same household;] (2) the renter's child over the age of eighteen or a parent or parent-in-law of the renter, provided such child, parent or parent-in-law is properly licensed to operate a motor vehicle and resides in the same household as the renter; or (3) a parking valet or parking garage attendant for compensation and in the normal course of employment[.];

(vii) The damage or loss arises out of the use of the vehicle outside of the continental United States when that use is not specifically authorized by the rental agreement[.]; or

(viii) The renter, or authorized driver [has], if different, or the renter's child over the age of eighteen or a parent or parent-in-law of the renter, if applicable, have failed to comply with the requirements for reporting damage or loss as set forth in subdivision five of this section.

(d) A customer may void optional vehicle protection at no charge within twenty-four hours of purchase provided that the customer: (i) has [rented the vehicle for] entered into a rental agreement with a term of two or more days, (ii) appears in person at any branch of the vehicle rental company together with the vehicle that shall be subject to inspection, and (iii) signs a cancellation form provided by the rental vehicle company. After twenty-four hours of purchase, a customer may prospectively terminate optional vehicle protection at any time, provided the customer: (i) appears in person at any branch of the vehicle rental company together with the vehicle that shall be subject to inspection; (ii) voids the optional vehicle protection in writing; and (iii) pays the optional vehicle protection charge for any full or partial rental day or portion of a day during which the optional vehicle protection was in effect.

3. Subject to the provisions of subdivisions six, seven, and nine of this section, a rental vehicle company may hold an authorized driver liable for actual damage to, or loss of, a rental vehicle, provided that: (a) any claim for such damage shall be based on a physical survey and shall be made upon the return of the rental vehicle, unless such survey is precluded because the vehicle is returned by automation [or], returned after-hours [which precludes such survey], or recovered by the rental company, in which event, any claim must be made within ten days after return or recovery; and (b) any charge for repair of such damage shall be limited to actual and reasonable costs and shall be assessed and billed separately and apart from the rental agreement. For purposes of this subdivision, "returned by automation" means a return [acknowledged by machine receipt and] where there is no interaction with rental vehicle company personnel; and "after-hours" return means a return after normal business hours and in which the keys [and rental agreement] are [deposited in] returned to the rental vehicle company [office] via a drop box or other process offered by the rental vehicle company.

4. (a) Any rental vehicle company which states or permits to be stated the rental costs of a rental vehicle in any advertisement shall state conspicuously, in plain language and in conjunction with the advertised rental cost of the vehicle, the daily rate of the applicable optional vehicle protection, that the rate constitutes an additional daily charge to the renter, that the purchase of such protection is optional, and that prospective renters should examine their credit card protections and automobile insurance policies for rental vehicle coverage.

(b) Where a written advertisement, including all print media, contains the statement of the rental cost of the vehicle, the disclosure required by this section shall be printed in type no less than ten point type.

A. 5270--C 5

(c) When the website of a rental vehicle company or the video presentation of a television or internet advertisement by the rental vehicle company contains the written statement of the rental cost of a vehicle, the depiction of the cost of the optional vehicle protection shall be clear and conspicuous.

(d) When a radio advertisement or the audio presentation of a television advertisement contains the statement of the rental cost of the motor vehicle, the oral statement of the rental cost shall immediately be accompanied by an oral statement of the cost of the optional vehicle protection.