16 September 2010 NEW
Consumer Alert – Beware of pitfalls when
renting car from Motor workshop
It has come to CASE’s attention that there were
motorcar workshops which provided rental cars to consumers when
they sent their cars for repair or servicing.
Even though this arrangement could be an
extension of goodwill on the part of the motorcar workshops and
provide convenience to consumers, consumers should exercise
prudence and check certain details carefully before agreeing to
use the car.
A few situations could arise if the consumer got
into an accident with the rental car
(1) The consumer may be required to pay damages
to the other party if the motorcar workshop’s car has not been
insured or has not been insured as a rental car or the motorcar
workshop’s car does not cover the consumer when he is driving
the workshop's vehicle. This may also amount to an offence as it
may be regarded that the consumer was driving a car which does
not have insurance coverage for the consumer.
(2) Even if the consumer is covered by insurance
when driving the rented motorcar, the consumer may be required
to pay excess – an amount the insured will be required to
contribute before they can make a claim
CASE’s advice to consumers is to rent a car from
a rental company if the consumer requires a car during the
period when the car has been sent for repair or servicing at a
motorcar workshop. When consumers decide to rent a car or use
the car provided by the motorcar workshop, he/she should
-
Check the terms and conditions of the rental
agreement (formal or informal) and verify if there is valid
insurance coverage for the rental car when he is driving the
vehicle. It could be that the insurance policy may cover the
workshop owners or employees but not consumers.
-
There are many types of motor insurance policies
and some policies will cover for damages to a third party
vehicle damage in cases of accidents whilst others also cover
cost of repair to the owners’ own vehicle damage.
-
Check for crucial clauses in the rental
agreement such as excess clause – whether consumers are required
to pay excess and how much excess to pay in case of damage
claims in a motor car accident.
Consumers should not accept the rental car if he
is not covered by insurance at all. It is an offence to drive a
motor vehicle without the necessary insurance coverage.
Look out for our latest advisories, warnings and
alerts here!
If you have an issue you want to tell us about,
e-mail us:
sayit@case.org.sg
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