Consumer Agency Receives 1,743 Disputes Over 5 Years
About 30% Occur During Summer Vacation Season
Cases with Low Limits on 'Complete Coverage' and 'Super Coverage'
With the summer vacation season underway, the use of rental cars has increased, leading to a rise in related consumer damages.
On the 16th, Yonhap News reported that the Korea Consumer Agency announced that the number of rental car-related damage relief applications received over five years from 2019 to 2023 totaled 1,743 cases. According to data from the Korea Consumer Agency, the number of cases received during the peak travel months of July to September was 519 (29.8%), the largest proportion. By region, inland accounted for 1,083 cases (62.1%), Jeju 639 cases (36.7%), and overseas 21 cases (1.2%). The majority of cases, 1,342 (77%), were related to contract and accident disputes.
With the summer vacation season approaching, the use of rental cars has increased, leading to a rise in related consumer damages. On the 16th, Yonhap News reported that the Korea Consumer Agency announced that the number of rental car-related damage relief applications received over five years from 2019 to 2023 totaled 1,743 cases. [Photo by Yonhap News TV]
Among these, until 2022, contract-related disputes such as contract cancellation, termination, and non-fulfillment were more common, but last year, disputes due to accidents were the most frequent. Looking at the 617 accident-related disputes received from 2019 to 2023 by reason, excessive repair cost claims accounted for 458 cases (74.2%), the highest number. Next were refusals of exemption or insurance processing with 107 cases (17.3%).
Many problems also occurred when rental cars were returned, such as charging repair costs and exemption fees in bulk without an estimate, or failing to provide supporting documents like repair invoices or cost details after repairs. Several disputes were also reported regarding separate collision damage waiver insurance products (vehicle damage exemption system) sold at high prices by rental car agencies under names like 'Complete Collision Damage Waiver' and 'Super Collision Damage Waiver.'
The business operators explain that all costs due to vehicle damage are fully exempted (compensated), but in reality, the exemption limits are low, requiring customers to pay excess repair costs, or in cases of single-vehicle accidents, exemption is not applied at all, with many exceptions, the Consumer Agency pointed out. In such cases, consumers should immediately notify the operator on-site when vehicle damage or an accident occurs and request an estimate and repair invoice if repairs are needed. The Consumer Agency urged, "Before subscribing to collision damage waiver insurance, rather than being misled by the terminology, carefully check whether there is a deductible in the terms and conditions, the exemption limit, and the scope of exemption exclusions."
The Consumer Agency plans to conduct consumer damage prevention activities in Jeju Island, where rental car demand concentrates during the summer vacation season. From mid-month, together with Jeju Special Self-Governing Province, they will visit rental car companies in the province to inspect operational conditions such as rental terms and vehicle maintenance status, and produce promotional materials containing precautions for each step from reservation to return, which will be distributed at major tourist spots.
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