Rental Car Liability or The Graves Amendment

Let’s say you’re in a car collision. You are hit from behind by someone doing 50 mph and you have to go to the hospital because the damage was so severe. Now, you have $100,000 you owe to the hospital. The person who hit you was on vacation from Wisconsin and was driving a rental car rented to him by Alamo.

Where do you get the money? If you don’t have health insurance, you’re going to be in trouble. Even if you have health insurance, though, you’re co-pay is going to be about $20,000.  If the guy who hit you doesn’t have enough money to cover your bill, you’re attorney can get money from the owner of the vehicle.

In this case, the guys from Wisconsin was renting the car from Alamo. So then your attorney would look to Alamo for the remaining money. Right? No.

There is a Federal law known as the “Graves Amendment” which forbids rental car companies from being held liable if one of their cars is involved in a car collision. So, unless the guy from Wisconsin had some other arrangement with Alamo for insurance, Alamo won’t have to pay a dime.

How can you protect yourself from this situation? Uninsured motorist coverage/insurance. Check out a previous article we wrote here on UM coverage.

If you have any questions about any of these topics, feel free to contact us at, 727-685-8000, or check out our other articles at