A rental store owner received a phone call from a customer who said that the rented machine had been damaged and that the rental store needed to pick it up. The rental store owner asked what happened and the customer hung up. The owner quickly dispatched a trusted employee to inspect and pick up the machine.
When the employee arrived, it was obvious that the machine had been rolled and the engine had not been shut off. The engine had seized and the overturn had caused severe damage. The employee called the owner and he sent more help to right the machine and get it back to the shop. When the owner questioned the renter, the renter said that one of his new guys was operating the machine, was too close to a steep incline and rolled the machine. Nobody was injured, but the machine was a total loss.
The rental store’s insurance policy covered the replacement of the machine and the rental store received a replacement in a few weeks. The rental store’s insurance carrier was able to recover the entire amount from the customer’s insurance carrier because of the language in the rental contract that stated the renter was responsible for all damages caused by overturn of a machine. When payment was made, the rental store received its entire deductible back. The contract gave the insurance company solid grounds to present its claim against the customer.
Does your contract give you the right to recover what is yours?
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This item, provided by ARA Insurance, Kansas City, Mo., is the story of a real-life insurance claim involving a rental store and is intended to help readers better understand and manage risk. For more safety and risk management information, customers of ARA Insurance can log on to ReSource. Access is free, so if you haven’t signed up yet, contact your agent or call 800-821-6580.