Where specifically must Budget make disclosures about LDW and potential charges in third-party reservation systems?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
a renter's liability to respondent for loss of or damage to the respondent's vehicle during the pendency of the rental agreement.
- D. "Insurance" means the renter's own standard vehicle insurance, and any alternative, supplemental, or secondary coverage the renter possesses that provides coverage for rented vehicles including, but not limited to, the coverage currently furnished by many credit card companies.
I.
- IT IS ORDERED that respondent, its successors and assigns, and its officers, agents, representatives, and employees, directly or through any partnership, corporation, subsidiary, division, or other device, in connection with the promoting, offering for rental, or rental of any vehicle, in or for any rental location where it seeks loss of turnback or turnback value in any form for vehicles rented in that location, in or affecting commerce, as "commerce" is defined in the Federal Trade Commission Act, does forthwith cease and desist from:
- A. Failing to disclose, clearly and prominently, in connection with any representation relating to the renter's liability for loss of or damage to a rental vehicle, including any representation about LDW, that in the event of loss of or damage to a vehicle for which LDW was declined, respondent may charge the renter between $x and $y (specify range of dollar amounts Budget may seek) more than the cost of repairs or the fair market value of the vehicle, that many insurance companies will not pay this charge, and that the renter will have to pay it. This paragraph applies specifically to, but is not limited to, Budget's rental contracts and to any representation relating to the price or terms of LDW made through respondent's inputs in the "company-specific location" part of third-party, computerized reservation systems, such as "Apollo", "PARS", "Sabre", or "System One".
Provided, however, that if respondent uses a "short-form" rental contract or other document or electronic form of agreement that makes it impractical to place the required disclosure withi
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, Budget must clearly and prominently disclose information regarding Loss Damage Waiver (LDW) and potential charges in specific locations. This disclosure is required in Budget's rental contracts and within the "company-specific location" part of third-party, computerized reservation systems such as Apollo, PARS, Sabre, or System One.
Specifically, Budget must disclose that if a renter declines LDW and the vehicle is lost or damaged, Budget may charge the renter an amount between $x and $y (a specified range of dollar amounts) that exceeds the cost of repairs or the vehicle's fair market value. The disclosure must also state that many insurance companies may not cover this charge, making the renter responsible for payment.
If Budget uses a short-form rental contract or another document or electronic form that makes including the full disclosure impractical, Budget must use alternative methods to ensure the renter receives the information before entering the rental agreement. These methods may include a separate disclosure document that the renter signs or initials. Additionally, Budget must post a sign or placard at each rental location with specific language regarding renter liability.