Question: On May 16, when we returned to our car parked at the Santa Barbara Amtrak station, a group of people was gathered in the lot. We were approached by a Santa Barbara police officer; someone had run into our car and fled the scene. The officer ran the license plate given to him by the witnesses and learned the car was owned by Hertz. We worked with the local office, and then we were asked to file a claim on May 19, which we did. An adjuster came to our office to view the damage and to complete the claim. All seemed to be in order until we received a letter stating that Hertz was going to cap its liability at $5,000. The damage is going to be closer to $8,000; Hertz said it would not pay the difference. Our car is 6 months old. What can be done?

Vanessa Troyer

Redondo Beach

Answer: This story does have a mostly happy ending but with some unhappy parts.

Besides contacting us, Troyer also contacted the chairman of Hertz Corp. and a Hertz public relations representative. That was June 16. On June 20, I talked with Troyer and listened, incredulously, to her story. At 11:22 a.m. June 23, I emailed the Hertz representative. At 11:38 a.m. June 23, Troyer received an email saying the damage would be covered.

This is undoubtedly coincidental, unless you're of the school of thought that believes that one should take credit even when it isn't due.

Some credit goes to Hertz Corp., which is the umbrella company for Dollar, Thrifty and Hertz (this was actually a rental from Dollar), for reconsidering this case, which has a twist: The driver who hit Troyer's car was visiting from Europe, where he lives.

Oh, and did we mention that the car he hit is a Tesla Model S 85, the much-talked-about electric car that starts at about $80,000 and was Motor Trend's 2013 car of the year?

The complication — other than Tesla's all-aluminum construction — was that the driver voided his insurance contract, said Paula Rivera, a Hertz Corp. spokeswoman.

"This international renter started out doing the right thing because he actually purchased liability and collision protection from us, so that was a good thing," she said, "except for the fact that a hit-and-run, to a degree, [makes it] null and void."

But Hertz reevaluated the seriousness of what voided the contract — the hit-and-run — and although what the driver did was wrong, it wasn't as serious as, say, damage incurred in the commission of a felony. The company decided to cover the cost.

One small hitch remained at press time, Troyer said: "The check came with a remittance that said 'full and final payment.'" The repair shop said the cost may be more than the estimate. "We decided to wait to see what the outcome of the repair shop's quote," she said.

Although most of us probably won't be driving a Tesla or returning after a fun day to find that someone has smacked into it, you may be the victim of a hit-and-run accident at some point. After all, about 30 million cars, non-commercial trucks and motorcycles were listed as registered in California in 2013, according to the Department of Motor Vehicles.

Or, worse, you may be renting a car and hit someone.

What should you do?

First, said Ting Pen, co-founder of ValuePenguin.com, a personal finance website, "In any situation, always contact your auto insurance company regardless of who's at fault." It is a good idea to have your insurance company's number on your phone.

And you should know what your insurance policy covers. Of course, who reads that stuff? No one. But when it comes to rental cars, you should.

If you're renting domestically and have car insurance, you probably don't want to buy the coverage the rental car company is selling; it's redundant. But you should know what your policy says — and what it doesn't say.

Here's what I learned from Ray Crisci, worldwide auto product manager for Chubb Personal Insurance, which works with high-net-worth clients: "People, if they do have [rental car] coverage on their auto policy, have the potential to pay hundreds and sometimes thousands out of their pocket." You're responsible for the damages, of course, but a mass-market policy (Chubb's isn't mass market, by the way) may not cover expenses you may not have thought about, including what the rental car company will charge you for loss of use, towing and storage, perhaps even diminution of value.

You may think that a credit card's insurance will cover you, but it's usually secondary coverage, Crisci said. "You have to look at the cardholder agreement and find what is and is not covered," he added.

When you thought about summer reading, you probably were thinking of the latest Janet Evanovich thriller. Reading an insurance policy instead won't thrill you, but it could save you a lot of money — maybe even enough money to cover your next vacation — and certainly save you a ton of worry.

 

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