CopyCited 11 times | Published | Supreme Court of Georgia | Mar 19, 1999 | 270 Ga. 757, 99 Fulton County D. Rep. 1127
...ority of insurance coverage for a rental vehicle involved in a collision. We affirm because the Court of Appeals correctly concluded that the car rental agency, AutoSave, could not avail itself of the exemption provided a U-drive-it owner under OCGA §
40-9-102, [1] rendering its insurance for the rental car primary for coverage of the collision....
...The trial court granted Generali's motion and denied Williams' motion, effectively declaring AutoSave's coverage primary. [2] The Court of Appeals affirmed the grant of summary judgment to Generali, concluding that despite AutoSave's attempted verification of coverage, AutoSave's insurance must become primary under OCGA §
40-9-102. It found undisputedly that Cabey did not have insurance at the time of the rental, and that Roberts was not a party to the rental agreement. 1. The clear language of OCGA §
40-9-102 addresses itself to the renter of the vehicle, not the operator, authorized or not, inasmuch as the relationship with the rental agency is a matter of contract....
...OCGA §
13-2-2(1); American Cyanamid Co. v. Ring,
248 Ga. 673, 674,
286 S.E.2d 1 (1982). The Court of Appeals correctly determined that driver Roberts was not a renter or co-renter under the agreement, and therefore not subject to the provisions of OCGA §
40-9-102. Compare Jones v. Wortham,
201 Ga.App. 668,
411 S.E.2d 716 (1991), in which the driver was also the lessee of the rental vehicle. 2. OCGA §
40-9-102 imposes upon the car rental agency the duty to verify that the renter has insurance for the rental, and if not, mandates the purchase of "spot" liability insurance prior to furnishing the vehicle....
...nce coverage for the rental vehicle from the rental agency. Atlanta Rent-A-Car v. Jackson,
204 Ga.App. 448,
419 S.E.2d 489 (1992). The Court of Appeals determined the existence of genuine issues of material fact as to AutoSave's compliance with OCGA §
40-9-102....
...But accepting for the sake of argument that AutoSave did all that it could or all that was reasonable to verify coverage before turning over the rental vehicle, the question is whether the car rental agency loses the statutory exemption provided by OCGA §
40-9-102 when it is later determined that the renter did not have insurance coverage. The answer to such question must be yes. This is so because of the clear legislative purpose behind OCGA §
40-9-102 and because of the public policy of this state. OCGA §
40-9-102 is plainly remedial....
...rresponsible renter of a U-drive-it vehicle. It does not do this by attempting to prevent tortious acts by the renter; it does not address such a problem, but rather assures that there is insurance coverage for the rental. That is the object of OCGA §
40-9-102....
...er person to operate the motor vehicle unless the owner has motor vehicle liability insurance equivalent to that required as evidence of security for bodily injury and property damage liability under the Motor Vehicle Safety Responsibility Act, OCGA §
40-9-1 et seq....
...ding." Stepho v. Allstate Ins. Co.,
259 Ga. 475, 476(1),
383 S.E.2d 887 (1989); GEICO v. Dickey,
255 Ga. 661, 663,
340 S.E.2d 595 (1986). Consequently, this Court must focus not on a perceived statutory entitlement for car rental agencies under OCGA §
40-9-102 but rather on fulfillment of the statute's goal....
...rimary coverage when the renter is uninsured, even if the lack of insurance is discovered post-collision, results in no unfairness to the agency. It is part of the cost of doing business. What is more, by providing the possibility of exemption, OCGA §
40-9-102 accords the rental agencies special treatment in the first place....
...Wortham, supra at 670,
411 S.E.2d 716. Judgment affirmed. All the Justices concur, except BENHAM, C.J., CARLEY and THOMPSON, JJ., who dissent. BENHAM, Chief Justice, dissenting. Faced with a case of first impression concerning the scope of the conditional exemption contained in OCGA §
40-9-102, the majority concludes that a car rental agency which fulfills its duties under the statute so as to be entitled to the statutory exemption provided therein loses that exemption and must take on the role of insurance guarantor because the purpose behind OCGA §
40-9-102 and the public policy of Georgia require it. I respectfully disagree with the majority's analysis and the conclusion it reaches. Accordingly, I dissent. 1. OCGA §
40-9-102 provides a mechanism by which the owner of a U-drive-it rental vehicle is exempted from the provisions of the Motor Vehicle Safety Responsibility Act (MVSRA)....
...ing the renter control of the vehicle, either to verify that the renter has his own liability insurance coverage which covers rental vehicles or to require the renter to purchase liability coverage for the vehicle in connection with the rental. OCGA §
40-9-102; Alamo Rent-A-Car v....
...The rental agency may lose its exemption only by turning over a rental car without having ascertained that the renter has liability insurance coverage for the rental vehicle either through the renter's personal policy or through a policy issued in conjunction with the rental. OCGA §
40-9-102....
...of liability insurance is not available to compensate the other driver and her passenger for the damages caused by the additional driver of the rental car. 2. The majority takes the position that the lack of insurance covering the renter causes OCGA §
40-9-102 to operate so as to put the rental agency in the position of a guarantor of insurance coverage. Relying on language in Continental Cas. Co. v. Owen,
90 Ga.App. 200(2),
82 S.E.2d 742 (1954), and Alamo Rent-A-Car v. Hamilton,
216 Ga. App. 659,
455 S.E.2d 366 (1995), the majority concludes that OCGA §
40-9-102 is "in the nature of a bond" which makes the rental agency a guarantor to protect the public against irresponsible renters of motor vehicles....
...endorsement or provision "undertaking to pay the insured all sums which he shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle." OCGA §
33-7-11(a)(1). Like the compulsory insurance statute, OCGA §
40-9-102 is a legislative effort to have insurance coverage available. However, like the compulsory insurance law, OCGA §
40-9-102 is not a guarantee that insurance coverage is available in all instances. Accordingly, the avowed goal of insurance coverage for all injured is not sufficient justification to negate the public policy embodied in the statutory exemption of OCGA §
40-9-102....
...to the renter) will no longer be valid. Instead, a rental agency can only ensure the existence of liability coverage by selling a policy of insurance to the renter in conjunction with the rental. Accordingly, a rental agency desirous of gaining the §
40-9-102 exemption will have to require the renter to purchase insurance coverage, even if the renter has existing coverage. Not only does the majority's interpretation of §
40-9-102 negate the portion of the statute authorizing the statutory exemption upon determining the existence of pre-existing coverage, it also invalidates the holding in Atlanta Rent-A-Car v....
...[4] As a result, I must respectfully dissent from the majority, which does not see the existence of the alleged tortfeasor's insurance coverage as a relevant factor in this case. I am authorized to state that Justice CARLEY and Justice THOMPSON join in this dissent. NOTES [1] OCGA §
40-9-102 provides: Any person who rents motor vehicles from a U-drive-it owner is required to provide his own insurance, and insurance companies authorized to issue automobile policies in this state shall be required by the Commissioner of Insuran...
...er than its own. However, AutoSave did not seek a specific ruling in this regard, and both the trial court and the Court of Appeals effectively treated AutoSave as the self-insurer of the vehicle. [3] The Court of Appeals stated its belief that OCGA §
40-9-102 "requires each individual operator to carry insurance" in Jones v....
...It is clear that the statute requires only that the renter provide insurance for the rental vehicle. Jones v. Wortham involved a tortfeasor/driver who was also the renter of the rental vehicle. The language in Jones should not be read as a holding that OCGA §
40-9-102 requires every operator of a rental vehicle to have insurance before the vehicle is rented, but must be limited to the factual setting in which it arosewhere the operator of the rented vehicle is the renter....
