Senate panel considers bill requiring proof of personal auto insurance to rent vehicles

Senate Bill 194 would amend Nevada law to allow rental-car companies to require a renter to provide proof of personal automobile insurance that meets or exceeds Nevada’s minimum liability limits before renting a vehicle.

Senator Melanie Scheibel presented the bill as a technical-but-substantive change to close a perceived loophole that allows some drivers to operate rented vehicles without maintaining personal auto insurance. "This amendment requires all renters to show proof of personal automobile insurance that meets or exceeds Nevada's minimum automobile insurance requirements to rent a vehicle," Soraya Bonner, an intern presenting on behalf of Sen. Scheibel, told the committee.

Brent Quist, general counsel for Malco Enterprises (doing business as Budget Car and Truck Rentals), said the change would stop situations where renters use rental vehicles as a substitute for vehicle ownership without carrying insurance. He cited a Nevada Supreme Court case—Alamo Rent A Car v. State Farm—saying rental companies are not insurance underwriters and do not perform driver histories or collect premiums. Quist said the bill amends NRS 482.31565 and would expressly allow rental companies to refuse to rent to an individual who cannot demonstrate compliance with Nevada's minimum statutory insurance requirements; alternatively, renters could still purchase short-term "spot" insurance at the counter or demonstrate a short-term policy bought in advance.

Industry groups testified in support. Andrew McKay of the Nevada Franchise Auto Dealers Association said requiring proof of personal insurance will help keep rental agencies from being treated as de facto insurers and could help reduce costs. Michael Alonso of Turo, speaking in neutral, noted peer-to-peer car-share regulations already require higher minimums in Nevada and suggested parity between industries could be considered.

Committee members asked how rental companies would verify coverage at the counter; Quist said agents would ask to see an insurance card and, in some cases, companies can check insurance status using available verification technology.

The committee closed the hearing on SB 194 after testimony; no committee vote occurred during the transcript. Several stakeholders indicated willingness to continue working on language and conceptual amendments that were posted before the hearing.

Sources: Testimony by Soraya Bonner (intern for Sen. Scheibel), Brent Quist (Malco Enterprises), Andrew McKay (Nevada Franchise Auto Dealers Association), Michael Alonso (Turo).