When to use a carrier's estimate

First, travelers should use their government VISA cards to rent cars for official travel; the credit card agreement with the issuing bank includes primary insurance coverage for all rentals up to thirty-one days. (30) This coverage applies to all authorized drivers of rental vehicles; it covers collision, theft, and other damage to the car, as well as towing charges and rental agency charges for loss of the car's use--with no deductible. The coverage applies to most cars, minivans with a capacity of up to eight passengers, and some sport utility vehicles; it does not apply to trucks or larger vans. The traveler must initiate and complete the rental with the government VISA account and decline the rental agency's Collision Damage Waiver (CDW) and Liability Damage Waiver (LDW). Travelers must report any losses to VISA within twenty days of the date of loss. The coverage excludes third-party liability and losses caused by intentional acts, such as drunken driving, illegal activity, off-road operation of the rental vehicle, or the traveler's failure to exercise due caution in safeguarding the vehicle. It also excludes losses due to hostilities of any kind. (31)

Although the VISA web site indicates that this coverage ended on 1 March 2002, (32) the coverage remains in effect for all banks issuing government VISA cards. The Army Claims Service recently confirmed that the coverage will continue; the parties have not set any end date for it. (33)

Travelers should choose rental agencies carefully to minimize their exposure to rental agency claims. The Military Traffic management Command (MTMC) has negotiated an agreement (MTMC Agreement), with many rental agencies in the United States and abroad. (34) The MTMC Agreement provides insurance coverage for rental vehicles that U.S. military and civilian employees use for official business; in many cases, this agreement also covers government contractors, Northern Alliance Treaty Organization (NATO) military members and employees, and U.S. government local national employees in some foreign countries. (35) Under the MTMC Agreement, the rental agency is primarily liable for the first $25,000 in damages to the property of third persons, (36) and for $100,000 per person and $300,000 per incident for personal injury or wrongful death to third parties. (37) The MTMC Agreement also states that the rental agency will bear a portion of the responsibility for damage to the rental vehicle. This liability is subject to exclusions similar to those mentioned above: illegal activities, driver negligence, operation of the vehicle off-road or across international boundaries without authorization, or use of the vehicle to push or tow another vehicle. (38)

Under the pre-November 2001 terms of the MTMC Agreement, the rental agency assumed responsibility for damage caused by the driver's simple negligence; vehicle drivers were only responsible for damage caused by their gross negligence or willful misconduct. (39)

Under Amendment 6 to the MTMC Agreement, Version 2, however, vehicle operators are also responsible for damages caused by their simple negligence. (40)