Administrative Fee

As the renter or additional driver, if you have insurance coverage for rental vehicles, your policy may or may not have coverage for the administrative fee. A responsible third party's policy will pay for what they become legally liable for. Since the administrative fee is a proper element of the claim, the liability policy should cover this item.

The law recognizes this contract as a valid service agreement, and the terms are enforceable. If damage occurs during the rental period, then the renter is responsible to pay an administrative fee. If a third party negligently damages the rental vehicle then they are responsible to put the injured party or parties in the position that they would have been in if the injury had never occurred. Under the theory of indemnification the third party has a duty to make the injured party whole. This responsibility is to both the driver of the vehicle as well as the owner of the vehicle. The damages that the rental agency are allowed to collect are intended to put the rental agency where they would have been of the accident or damage had never happened. They are to receive no more and no less than what would compensate them and make them whole for this loss.

The most basic principle of tort law is to make the claimant whole or to return him to his prior status before the tort.

• Hertz, "Your responsibility will not exceed the full value of the car at the time it is lost or damaged, less its salvage value, plus actual towing, storage and impound fees, an administrative charge and a reasonable charge for loss of use."

• National, "I will pay you for all loss, or estimated damages to the vehicle including loss of use, claim processing fees and administrative charges, as permitted by law."

• Budget, "Regardless of fault, renter is responsible for all other loss of and damage to the vehicle and all related expenses, plus Budget's loss of use and an administrative charge for expenses associated with processing the loss and damage claim."

• Dollar, "Your liability will not exceed the full value of the vehicle, actual towing and storage charges, loss of use and reasonable administrative fees allowed by law."

• Avis, "I'll also pay loss of use based on reasonable downtime or as specified by law. Plus a reasonable administrative fee determined by you or specified by law."

The rental contract holds the renter of the vehicle responsible for all loss or damage to the vehicle despite fault. The contract language specifically provides for the administrative fee. The presumption is that the bailee of the property had a duty to keep the property safe and in the same condition in which they received it. When the property is returned damaged, the presumption is that the damage occurred while the renter had the property. The rental contract is not written to place an undue and unfounded burden on the renter, but rather to enforce the common law presumption that the bailee is responsible for all damage to the property in their care.

The renter, additional renter, authorized driver and a responsible third party are responsible to pay for the administrative fee.