AN ACT Relating to motor vehicle rentals; adding a new section to chapter 48.22 RCW; adding a new chapter to Title 19 RCW; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The ability to rent motor vehicles at a reasonable price and upon reasonable terms is vital to promoting tourism and business in Washington. The public interest is adversely affected when consumers must agree to unreasonable terms to protect the interests of the rental vehicle owner from damage caused by the renter. This chapter shall be liberally construed to protect Washington consumers from unfair and deceptive practices in the sale and content of vehicle rental agreements and collision damage waiver agreements made in conjunction with the rental of a motor vehicle.

NEW SECTION. Sec. 2. Unless the context requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Advertisement" means an oral, written, graphic, or pictorial statement or representation, including those made through an electronic or print medium. "Advertisement" does not include telephonic communications.

(2) "Collision damage waiver agreement" means a contract or contractual provision, whether separate from or a part of a motor vehicle rental agreement, whereby the rental company agrees for a charge, to waive claims against the renter for damages to the rental motor vehicle during the term of the rental agreement.

(3) "Rental company" means a person or organization in the business of providing rental motor vehicles to the public.

(4) "Renter" means a person or organization obtaining the use of a rental motor vehicle from a lessor under the terms of a rental agreement.

(5) "Rental agreement" means a written agreement setting forth the terms and conditions governing the use of the rental motor vehicle.

(6) "Rental motor vehicle" or "vehicle" means a motor vehicle as defined in RCW 46.04.382 that is rented or leased or offered for rent or lease in this state, whether for personal or commercial use for a period of thirty days or less.

(7) "Rental cost" means the daily or periodic rate charged for the use of the rental motor vehicle, but does not include optional or refueling charges.

(8) "Authorized driver" means the person to whom the vehicle is rented and, if a licensed driver and satisfying the rental company's minimum age requirement:

(a) The spouse of such person; and

(b) A person expressly listed by the rental company on the rental agreement as an authorized driver.

(9) "Plain language" means language written or spoken in a clear and coherent manner using words with common and everyday meanings.

NEW SECTION. Sec. 3. Each rental agreement that contains a collision damage waiver agreement shall disclose, at a minimum, in plain language and in at least ten-point, boldface type, the following information:

(1) That the collision damage waiver agreement is optional;

(2) That the collision damage waiver agreement entails an additional charge;

(3) The actual charge per day for the collision damage waiver;

(4) All restrictions, conditions, and provisions in or endorsed on the collision damage waiver agreement;

(5) That the renter may already be sufficiently covered and should examine the renter's personal automobile insurance policy to determine whether it provides coverage for collision damage and the amount of the deductible;

(6) That by entering into the rental agreement, the renter may be liable for damage to the rental vehicle and a description of that liability; and

(7) An acknowledgement signed by the renter that the renter understands the information required under this section.

NEW SECTION. Sec. 4. (1) A term, condition, or provision of a collision damage waiver agreement or rental agreement that violates this chapter is void and unenforceable.

(2) No collision damage waiver agreement may exclude damages caused by the ordinary negligence of the renter.

(3) The collision damage waiver agreement may exclude only the following:

(a) Damage caused intentionally by the renter or as a result of the renter's willful or wanton misconduct;

(b) Damage caused through the renter's operation of the vehicle while intoxicated or under the influence of a drug, or the combined influence of alcohol and a drug;

(d) Damage caused by the use of the vehicle while committing or otherwise engaged in the commission of a felony;

(e) Damage occurring while the vehicle is being used to carry persons or property for hire;

(f) Damage caused by the use of the vehicle to push or tow anything unless towing is clearly authorized by the rental agreement;

(g) Damage occurring while the vehicle is being driven by or in the possession of a person other than an authorized driver;

(h) Damage occurring while the vehicle is outside the United States or Canada; and

(i) Damage occurring while the vehicle is being used to teach driving.

NEW SECTION. Sec. 5. (1) Each rental company, and each officer, employee, agency, or other representative of the rental company, who states or permits to be stated the rental cost of a rental motor vehicle in an advertisement, shall state conspicuously, in plain language and in conjunction with the advertised rental cost of the vehicle, the daily rate of the applicable collision damage waiver agreement, and that the rate constitutes an additional daily charge to the renter.

(2) When a written advertisement, including all print media, contains the statement of the rental cost of a vehicle, the disclosure required by this section shall be printed in type no less than one-third the size of the type used to print the rental cost or twelve-point type, whichever is larger.

(3) When the video presentation of a television advertisement contains the statement of the rental cost of a vehicle, the depiction of the disclosure required by this section shall be no less than one-third the size of the depiction of the rental cost.

(4) When a radio advertisement or the audio presentation of a television advertisement contains the statement of the rental cost of the vehicle, the oral statement of the rental cost shall be immediately accompanied by an oral statement of the disclosure required by this section. Except as set forth in this section, the statement of the rental cost and the disclosure shall be equally prominent in all respects.

NEW SECTION. Sec. 6. Each rental company, and each officer, employee, agent, or other representative of the rental company, who makes an oral statement, excluding telephonic communications, or written statement of the rental cost of a vehicle, shall disclose, in plain language and in conjunction with that statement, the daily rate of the applicable collision damage waiver agreement and that the rate constitutes an additional daily charge to the renter.

NEW SECTION. Sec. 7. Before the execution of a rental agreement, each rental company that offers collision damage waiver agreements to a renter shall provide to the renter a pamphlet, written in plain language, that includes all the information contained in section 3 (1) through (6) of this act and the address and phone number of the Washington state attorney general's office, along with a statement that if the renter has any comments or complaints related to the rental company the renter should contact the Washington state attorney general's office. The requirements of this section are deemed satisfied if the rental company places the pamphlets prominently and conspicuously on the rental desk or countertop, where the pamphlets may be easily seen and reached by renters and potential renters.

NEW SECTION. Sec. 8. The following acts or practices constitute a per se violation of chapter 19.86 RCW:

(1) Engaging in any unfair, deceptive, or coercive conduct to induce a renter to purchase a collision damage waiver agreement, optional insurance, or any other optional good or service, including conduct such as, but not limited to, refusing to honor the renter's reservation, limiting the availability of vehicles, requiring a deposit, or debiting or blocking the renter's credit card account, for a sum equivalent to a deposit for damages to a vehicle that is in the renter's possession, custody, or control;

(2) Upon the renter's return of the vehicle in a damaged condition, requiring a payment for damages to the rental vehicle until after the cost of the damage to the vehicle and liability for it is agreed to between the renter and the rental company or is determined pursuant to law;

(3) The making or omission of a material statement that has the tendency or capacity to mislead or deceive, either orally or in writing, in connection with the rental of, offer to rent, or advertisement to rent a vehicle;

(4) The failure to provide information or disclosures required by this chapter;

(5) The charging by the rental company to a renter of more than the cost of the parts and labor necessary to repair a damaged vehicle in accordance with the standard practices in the automobile repair industry in the community;

(6) Engaging in unfair, deceptive, or coercive tactics in attempting to recover or in recovering on a claim arising out of damage to, or loss of, a rental vehicle;

(7) Charging the renter more for fuel than is actually provided by the rental company and used by the renter and at a price not disclosed in the rental agreement; and

(8) Charging a fee for authorized drivers in addition to the rental charge for an individual renter.

NEW SECTION. Sec. 9. This chapter does not affect the rights and remedies a renter may have against a rental company under any other law.

NEW SECTION. Sec. 10. A new section is added to chapter 48.22 RCW to read as follows:

(1) Every property and casualty insurance company that offers private passenger motor vehicle liability insurance shall offer separate coverage for the obligation of the insured for actual damage to, or loss of a rental motor vehicle (including loss of use of such vehicle) rented by an insured in the United States and Canada.

(2) Nothing contained in this section requires an insurer to make payment under the coverage required under this section for damage to, or loss of, a rental motor vehicle (including loss of use of the vehicle) that the rental company is precluded from recovering from the insured, and nothing contained in this section precludes an insurer from pursuing subrogation rights in connection with claims involving rental motor vehicle coverage.

NEW SECTION. Sec. 11. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 12. Sections 1 through 9 of this act constitute a new chapter in Title 19 RCW.

NEW SECTION. Sec. 13. This act shall take effect January 1, 1990.