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Free car for not at-fault driver

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Someone has smashed into your car, which puts it off the road for some time. This common scenario has given car hire companies the chance to come up with a service where they provide you, the driver whose car is in the garage for repairs, with a like-for-like replacement while your damaged vehicle is off the road.

Why don't I know about this?

Like ride-sharing Uber, this is a fairly recently service introduced by some car rental companies which know how reliant we are on our wheels. These companies, whose brands include itwasntmyfault, Not At Fault, Compass Claims and Acorn Rentals, don't advertise but can be readily found online by searching for not-at-fault car rental services.

car crash

Mostly the availability of this service spreads through word of mouth. According to Compass Claims, only 6% of the population know it exists, so it's a growing market. Some firms providing free car hire to not-at-fault drivers also provide claims-handling and repair services.

What conditions apply?

The first is that you are not the at-fault driver. The at-fault driver has to admit fault and provide you with his or her contact details; you should also have the at-fault driver's number plate.

Another important condition for the car replacement service to be free for you is that the at-fault driver has accident insurance so that the rental company can claim the cost of providing you the replacement vehicle from the at-fault driver's insurance company.

The bottom line is that if there is no insurer from which the rental company can recover the car rental cost, it won't provide you with a free vehicle.

In effect, the rental car is provided to you on credit. It's called credit hire. At the end of the rental, the care hire company recovers the rental charge from the at-fault driver's insurance company.

This is where it can get tricky. If for some reason the car rental company can't locate the at-fault driver or his or her insurer (say, because you have been given false driver information, or the car is stolen), or the at-fault driver isn't insured you may be up for the car rental fee unless you have already ticked that option on your regular insurance policy as an extra service. Usually that involves a small additional charge on top of your insurance premium. The car hire company isn't providing a charity service. It will want to be paid by someone. And that may be you.

Furthermore, if your car is damaged in a car park or while parked in the street and the driver doesn't leave his or her contact details, the service won't provide you with a free replacement car.

It is therefore important, when you are offered the like-for-like rental car, to make sure the hire company has all the information it needs, that it has determined the at-fault driver has insurance and that his or her insurer will pay for the car hire.

Do I get a like-for-like car?

All the not-at-fault car replacement companies claim they will do their best to provide a Mercedes if your Merc has been damaged, or a station wagon if that is what is in the garage. But it isn't guaranteed.

What if I'm the at-fault driver?

The free car hire offer does not apply. You will have to pay for the hire, unless your comprehensive policy entitles you to a replacement from your own insurer. In fact, it may be your insurance company that will be paying for the other driver's car hire while that car is off the road.

Car replacement

Pros: This looks like a good service to ask about as your car is towed to the garage for repairs. Accessing it might save you hundreds of dollars in car rental charges.

Cons: It all hinges on the at-fault driver having accident insurance so that the rental company can claim back the costs. Otherwise, you might end up footing the bill.

My call: Before you accept a "no cost" replacement car, clarify that you meet all the conditions required to ensure that you won't be handed the bill if the car replacement company can't recover the cost from an insurer. If your wheels are critical to you, it is a good idea to tick the car replacement option on your comprehensive car insurance policy to ensure that you have a replacement vehicle no matter who is at fault in an accident. It's usually a small charge, and worth it.

Anne Lampe has written for The Australian Financial Review and The Sydney Morning Herald, winning a Walkley award in 1991. Car replacement

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Comments
Joseph Sarkozi
July 20, 2016 9.35am

I was offered a replacement van by one of these companies as soon as I and my vehicle was delivered by tow truck to the repairer after a bad accident. To my surprise, the representative of one of these "not-at-fault" hire companies did indeed have the replacement van ready for me out front of the repairer once I had completed booking in of my damaged vehicle...however...completing... all the details with the representative of the "not-at fault" hire company was so long and excruciating considering I was in an accident involving ten cars, I picked up the phone and called my wife to pick me up and then abruptly wished the representative well in his endeavours. It was not an easy process...was much easier to hire a van from Budget and have my employer reimbursement me. So yeah, my first experience with this sort of company was not good. But if you tick off all their boxes and provide every last bit of information they need or want, who am I to discourage you to go with one of these "not-at-fault" hire companies.

auto repair
October 13, 2016 2.32pm

The proceeds of selling your older car can go to the operations of
the charity like giving food or clothing to the family that they supported.

Strict standards and excellence in service is what made Cullitons the
premiere limo service of choice for thousands of Torontonians as well as visiting guests from all over the world.
The damage varies from vehicle to vehicle but can be as small
as light hail damage which is barely visible through to
damage caused by falling trees.

Ty White
January 10, 2017 12.31pm

Thumbs up for this kind of article it helps car owners and not at fault drivers know what are the things to consider. It's pros and cons to be exact.

mick
January 10, 2017 10.57pm

Compass claims offer vehicles to drivers who are involved in a not at fault accident. They begin by telling you that the at fault insurance company will cover the costs of the hire car. This is not true, the at fault insurance company has not accepted the hire car cost at this point. Compass Claims strategy is to stick you with an expensive hire car, that they hire out at exorbitant prices. When you drop off your own car for repairs, the hire car and consultant are waiting. The consultant will deceptively breeze through all the paper work in less than a minute. The consultant gets you to sign off on the liability of the car hire costs without being transparent and honest about the liability or the position you have been put in. Fundamentally they are setting you up so they can extort the cost of car hire from you. The hire car costs are in excess of the total cost of repairs for your vehicle and the insurance premium that you pay. After using the vehicle they will then contact you telling you "Unfortunately we have been unable to reach an agreement with the negligent party's insurance company. Numerous attempts have been made, however they are unwilling to pay a reasonable amount for your outstanding hire charges." They then tell you that compass will fund all legal costs to recover YOUR LIABILITY ie. the exorbitant hire invoice. After supposedly some numerous attempts to recover the outstanding hire charges. They then bully you with lawyers and extort the liability(exorbitant hire car invoice) out of YOU. This is a well organised and deceptive organisation whom are money junkies! A corrupt outfit. Please stay away and warn others.

Caroline Osborne
October 1, 2019 11.00am

Mick, you are totally on the money and this is still happening 2 years on from your post. That is exactly the experience I had and I had to fight like hell and stick to my guns after their legal team started to pile the pressure on as the 'at fault party's' insurer would not agree to pay after their initial reassurance to the contrary. I did not get a comparable car either but as they charge those ridiculously inflated rental fees for a very basic car, no wonder the respective insurance companies will not pay.

Michelle
March 28, 2017 7.32pm

Mick, my son had the same problem with Compass Claims, he is only young and did not understand the liability. But luckily when he was signing off on the car, I was beside him and asked all the right questions. After he returned the car, he did receive a call from them saying the other persons insurance would not pay the additional costs, but that their Lawyers would represent my son in court to help recover all the costs. I told him to throw the paperwork our once he received it and he did not need to be represented in court as it was not his liability, it was theirs. After numerous phone calls, in the end I got involved and told them I would take it to the ombudsman as they were harassing him. We have not heard back from them at all. And yes, the cost of the hire care was absolutely ridiculous. Be very careful people, make sure you are definitely not going to have to pay anything at all.

Annon
July 2, 2017 9.29am

I cannot speak for Compass Claims... although it does concern me quite a bit now... I recently had someone run into my brand new Ford Kuga in Melbourne, whilst I was in the shops. She was an L-Plater and luckily her mum got out of the car and left a name and details and then they left. The damage didn't look that bad but in fact it needed a whole new front end. I contacted them and they were really quite lovely and the mother dealt with everything and the father just happened to be a panel beater. So I took my car for a quote to him. It was quite close to me anyway. He informed me that a replacement vehicle would be waiting for me when I dropped my car off. The day I dropped the car off a Hyundai i-X35 was waiting for me and all I had to do was give them a photocopy of my drivers licence. The panel beater filled the rest of the form out and it was super quick... I pick my car up sometime this week (fingers crossed) and I am now PRAYING and hoping that I do not end up foot with the bill like Compass Claims is apparently doing to its customers....

Tom
July 21, 2017 11.53pm

It is happening to me same problem with compass, they said the at fault insurer doesn't want to pay for the hired car etc and the legal team sent me a email to sign with legal costs and stuff to go after the other party and make them pay for thw hired car they gave me, I seriously don't wanna do that, and reading the contract back from the hired car I can't see anything saying that I would have to pay in case the other party doesn't pay for the hired car. Any advices?

JustDont
August 15, 2017 9.01pm

On the face of it this is a reasonable service. If you're not at fault, you shouldn't be inconvenienced, right?
Unfortunately, this is being exploited by the car hire companies who work on your (the not-at-fault-driver's) sense of outrage and entitlement. They will provide you with a more or less like-for-like car, but the rates they charge are extraordinary.
My partner had a crash where she was at fault. The other driver took up one of these kind offers. The hire costs for 7 days (while the vehicle was repaired) were over $3,400. The replacement car was actually driven for < 100 km.

Someone, somewhere, pays. Not you, you say? Well, actually yes. Even if the at-fault driver's insurance coughs up the extortionate rate (and they won't) that'll just eventually get passed on in higher premiums for everyone. Basically this practice will add between 10 and 40% to the cost of repairs. Where's that coming out of? The insurance companies' bottom line? The goodwill of the hire company? Nope. Nope.

In our case the insurance company offered a "fair" rate. It was refused, so the hire company came after us. Weeks of legal threats, and proceedings commenced, before the insurance company stepped back in.

Yes, on the face of it this is a "good service". In practice they're opportunistic bottom-feeders.

Bin J
August 25, 2017 10.51pm

Michelle, I have the same problem recently, just received paperwork. The repairer suggested and organised Compass Claim for me, a lady from CC rang me and asked me all the details then said I approved and eligible to have a hire car for free. I have kept asking them each time they contact me about who gonna pay for it and do I have the liability under this case. Everyone said the other party's insurance will pay for it. Now they change their words. That is ridiculous. I'm going to take it to ombudsman.

Crashed-into
January 24, 2018 1.15pm

All these people complaining about having this add 10%-40% to the cost of repairs and higher premiums, get over yourselves. Get off your god-damn mobile phones and stop crashing into the back of people. That's where the real problem is. Idiots using mobile phones when they are driving.
Anyway - Australian Courts have determined many times that the not-at-fault driver is entitled to a like-for-like vehicle when the vehicle is necessary for the owner.
I used one of these companies and it was awesome. Try getting your insurance company to agree to a like for like rental and they will laugh in your face, despite the fact that it is the law.