SB1268 96TH GENERAL ASSEMBLY

LRB096 04078 AJT 14117 b

96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
SB1268

Introduced 2/10/2009, by Sen. Terry Link

SYNOPSIS AS INTRODUCED:

625 ILCS 5/6-305.2

Amends the Illinois Vehicle Code. Raises a motor vehicle renter's maximum liability for actual and reasonable costs incurred by the loss due to theft of the rental motor vehicle up to its fair market value immediately before the loss occurred using a commonly and commercially accepted method to establish a fair market value (rather than $2,000); deletes provisions relating to a failure to exercise ordinary care. Provides that if the estimate of repair exceeds $3,500, then, prior to any repairs being initiated, the insurer of the renter or the renter shall be allowed 72 hours from the date of notice to inspect the damaged vehicle and obtain another estimate of repair on the damaged vehicle. Effective July 1, 2009.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning transportation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Vehicle Code is amended by changing Section 6-305.2 as follows:

(625 ILCS 5/6-305.2)

Sec. 6-305.2. Limited liability for damage.

(a) Damage to private passenger vehicle. A person who rents a motor vehicle to another may hold the renter liable to the extent permitted under subsections (b) through (d) for physical or mechanical damage to the rented motor vehicle that occurs during the time the motor vehicle is under the rental agreement.

(b) Limits on liability. The total liability of a renter under subsection (a) for damage to a motor vehicle may not exceed all of the following:

(1) The lesser of:

(A) Actual and reasonable costs that the person who rents a motor vehicle to another incurred to repair the motor vehicle or that the rental company would have incurred if the motor vehicle had been repaired, which shall reflect any discounts, price reductions, or adjustments available to the rental company; or

(B) The fair market value of that motor vehicle immediately before the damage occurred, as determined in the customary market for the retail sale of that motor vehicle; and

(2) Actual and reasonable costs incurred by the loss due to theft of the rental motor vehicle up to its fair market value immediately before the loss occurred using a commonly and commercially accepted method to establish a fair market value $2,000; provided, however, that if it is established that the renter or an authorized driver failed to exercise ordinary care while in possession of the vehicle or that the renter or an authorized driver committed or aided and abetted the commission of the theft, then the damages shall be the actual and reasonable costs of the rental vehicle up to its fair market value, as determined by the customary market for the sale of that vehicle.

For purposes of this subsection (b), for the period prior to June 1, 1998, the maximum amount that may be recovered from an authorized driver shall not exceed $6,000; for the period beginning June 1, 1998 through May 31, 1999, the maximum recovery shall not exceed $7,500; and for the period beginning June 1, 1999 through May 31, 2000, the maximum recovery shall not exceed $9,000. Beginning June 1, 2000, and annually each June 1 thereafter, the maximum amount that may be recovered from an authorized driver shall be increased by $500 above the maximum recovery allowed immediately prior to June 1 of that year.

(c) Multiple recoveries prohibited. Any person who rents a motor vehicle to another may not hold the renter liable for any amounts that the rental company recovers from any other party.

(d) Repair estimates. A person who rents a motor vehicle to another may not collect or attempt to collect the amount described in subsection (b) unless the rental company obtains an estimate from a repair company or an appraiser in the business of providing such appraisals on the costs of repairing the motor vehicle, makes a copy of the estimate available upon request to the renter who may be liable under subsection (a), and or the insurer of the renter, if known by the rental company, and submits a copy of the estimate with any claim to collect the amount described in subsection (b). If the estimate of repair exceeds $3,500, then, prior to any repairs being initiated, the insurer of the renter or the renter shall be allowed 72 hours from the date of notice to inspect the damaged vehicle and obtain another estimate of repair on the damaged vehicle.

(e) Duty to mitigate. A claim against a renter resulting from damage or loss to a rental vehicle must be reasonably and rationally related to the actual loss incurred. A rental company shall mitigate damages where possible and shall not assert or collect any claim for physical damage which exceeds the actual costs of the repair, including all discounts or price reductions.

(f) No rental company shall require a deposit or an advance charge against the credit card of a renter, in any form, for damages to a vehicle which is in the renter's possession, custody, or control. No rental company shall require any payment for damage to the rental vehicle, upon the renter's return of the vehicle in a damaged condition, until after the cost of the damage to the vehicle and liability therefor is agreed to between the rental company and renter or is determined pursuant to law.

(g) If insurance coverage exists under the renter's personal insurance policy and the coverage is confirmed during regular business hours, the renter may require that the rental company must submit any claims to the renter's personal insurance carrier as the renter's agent. The rental company shall not make any written or oral representations that it will not present claims or negotiate with the renter's insurance carrier. For purposes of this Section, confirmation of coverage includes telephone confirmation from insurance company representatives during regular business hours. After confirmation of coverage, the amount of claim shall be resolved between the insurance carrier and the rental company.

(Source: P.A. 90-113, eff. 7-14-97.)

Section 99. Effective date. This Act takes effect July 1, 2009.