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Auto Insurance

Is Your Rental Car Company Spying on You and Your Driving? Here’s How They Do It

My Finances Today — Rental car giant Hertz has admitted it has cameras installed in about one in eight of its cars in the United States. But those cameras – built into Hertz’s NeverLost dashboard assistant that offers routing help and local city guides – have never been turned on, Hertz has said, loudly and repeatedly. Understand that NeverLost 6 was launched by Hertz in early 2014 – the product has been out there over a year – and only now is it causing a flap, probably because more renters began noticing a creepy camera pointed at them.

Understand too: there are excellent reasons to worry about car rental companies spying on drivers but, very probably, NeverLost 6 is not one of them. Hertz had said it lacked the bandwidth to use the cameras anyway but it has been scorched so severely in the media flap of the past weeks that industry experts indicated that Hertz now would be just about the last company to spy on customers. But there are many others that do.

Fact: most rental cars are equipped with navigation and GPS systems. Are they used against drivers? Well, yes and no. The yes part is that, starting around a dozen years ago, newspapers were filled with sad stories of rental car customers “fined” hundreds – sometimes thousands – of dollars for violating the terms of their contracts. How? In one celebrated case, Acme Rent-a-Car of New Haven fined a particular customer $450 ($150 per incident) for exceeding posted speed limits. The customer had not received traffic citations. And the customer sued. The judge ruled against Acme. He did not dispute the right to track. But he said there was insufficient “notification” to make the fines justified.

In another famous case a Payless customer expected a bill for $259.51. He was instead slapped with a bill for $3,405.05, which was reached by adding a $1 per mile to each of the 2,874 miles he had driven, because he had crossed the California state line into Nevada and, later, he drove into Arizona. That triggered the fines, because the contract prohibited leaving the state.

In many more cases, numerous Florida car rental companies are notorious for literally shutting off engines of cars that cross state lines. The cars may be restarted upon agreement to pay new fees.

Is this legal? Neil Abrams, a car rental consultant in Purchase, N.Y., said, “It is legal as long as it disclosed.” As the Acme case illustrated, however, disclosure has to be loud and in a renter’s face. Fine print footnotes buried in a multi page contract may not be good enough for many courts.

What’s more, Abrams said that from his seat, use of tracking was much more prevalent a few years ago, perhaps because companies were exploring the limits of new technologies. “It was more true a few years ago,” said Abrams. “There was a spotlight on it. It’s much less frequent now.” As customer anger grew – and negative newspaper stories multiplied – the big, national companies cut way back on use of tracking tools.

Case in point: Enterprise Rent-a-Car, in response to a reporter’s question, issued a flat denial: “We do not install cameras in our vehicles. Enterprise Rent-A-Car, National Car Rental and Alamo Rent A Car passenger vehicles come equipped with only standard technology, as provided by automobile manufacturers. For example, some of our GM vehicles are equipped with OnStar technology – however, we can’t access the technology without an official police report (to document that a vehicle is lost or missing).”

Other big players have similar policies.

But driver tracking still happens at small, independent companies, Abrams said.

A primary reason: those companies, said industry experts, are very concerned about stolen cars, and, honestly, it is not that hard to walk up to a car rental counter, present a decent counterfeit driver’s license and a stolen credit card and drive off in a $30,000 Toyota Camry that can be sold for cash at the nearest chop shop. Rental companies in Arizona, Texas, New Mexico, and California have the added problem of the Mexican border.

Small companies also are very concerned about vehicle abuse – hard driving off-road, for instance, or significant speeding. Built-in monitoring technology gives them an early warning that bad things are happening to their asset and they may be able to cut their losses.

The upshot: many companies use tracking devices that are programmed to send alerts only upon occurrence of particular trigger events such as crossing a state line or an international border, said experts. The technology, insisted Abrams, “is not used to track where people go,” which is to say, it involves no obvious privacy concerns. “It’s there to keep people from going where they shouldn’t.”

But that’s at the national chains. At the mom and pop independents, apparently anything goes. Renter beware.

Word of advice: when renting at an independent, always ask at the counter how and what they track. Pay close attention. Those few seconds can spare you big agony later.

—Written by Robert McGarvey for MainStreet

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