Avoid these 9 car-rental rip-offs

Renting a car should be simple: You reserve a vehicle, drive it, and return it at the end of your trip.

But for millions of travelers each year, what seems like a straightforward process can quickly become a source of frustration and unexpected costs.

In 2024, US car-rental companies collected more than $2 billion in optional insurance and add-on fees.

Hidden fees, deceptive insurance upsells, false damage claims, and overpriced extras have become all too common, turning a simple rental into a costly experience. Understanding how rental companies operate and knowing what to watch for can save you time, money, and stress.

1. Hidden fees

One of the most pervasive problems in car rentals is the hidden fee. Travelers are often lured in with low advertised rates, only to be shocked when extra charges appear on their final bill.

These can include cleaning fees, administrative charges, or taxes that were not clearly disclosed. A rate that appears to be $25 a day can quickly balloon when additional costs are tacked on. The key to avoiding these surprises is vigilance: reading the contract carefully, asking for a full breakdown of potential charges, and choosing reputable rental companies that provide transparency from the start.

2. Fuel charges

Fuel charges are another frequent source of frustration. Many agencies offer prepaid fuel options, promising convenience at a flat rate. In reality, these plans often overcharge travelers. A prepaid tank might cost $70, while filling up locally could cost half that. The best strategy is to select a policy requiring you to return the car full and refuel it yourself, giving you control over price and avoiding overpayment.

3. Insurance upselling

Insurance upselling is a classic tactic at rental counters. Agents may encourage you to purchase extra coverage, claiming your personal insurance or credit card benefits are insufficient. Many credit cards already include rental car insurance, and personal auto policies often extend coverage to rentals. Knowing what protections you already have, and bringing proof, allows you to confidently decline unnecessary insurance and avoid paying for coverage you don’t need.

RELATED: 10 tactics to beat even the pushiest car salesman

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4. Damage claims

Damage claims can create even bigger headaches. Renters are frequently billed for scratches, dents, or other damage that existed before their rental. Without proper documentation, disputing these charges can be difficult. To protect yourself, inspect the car thoroughly before and after driving, take comprehensive photos or videos, and ensure any pre-existing damage is recorded by the rental agent. A few minutes of documentation can prevent thousands of dollars in unjust repair charges.

5. ‘Free’ upgrades

Even seemingly generous “free” upgrades can carry hidden costs. A larger or fancier car may require premium gasoline, have lower fuel efficiency, or carry higher insurance rates. What seems like a perk can quickly become an unexpected expense. Always confirm the details of any upgrade before accepting it and assess whether it truly makes sense for your trip.

6. Early return penalties

Timing is another area where fees can accumulate. Early returns may trigger additional charges, as some companies consider schedule changes disruptive to their fleet planning. Returning a vehicle late, even by an hour, can also result in steep penalties, sometimes amounting to a full extra day’s rental. Understanding the agency’s policies, communicating any changes in advance, and planning your return carefully are essential to avoid unnecessary fees.

7. Unauthorized driver penalties

Unauthorized drivers are another hidden cost. If someone not listed on the rental agreement drives the vehicle, you may face significant penalties. This can be particularly costly during family trips when multiple people share driving duties. The solution is straightforward: Ensure every driver is added to the contract up front. Some companies even offer one free additional driver, which can reduce the financial burden and prevent insurance complications.

8. Location surcharges

Location surcharges are a more subtle form of deception. Renting at airports or central city locations is convenient, but convenience comes at a premium. Airport locations can be 20% to 30% more expensive than nearby off-site branches. Taking the time to compare rates at alternative locations and factoring in transportation costs can yield substantial savings.

9. Add-on accessories and services

Additional accessories and services: GPS devices, car seats, and toll passes are often priced exorbitantly. Renting a car seat can cost $15 to $20 per day, adding up to over $100 for a week-long trip. Smartphones equipped with navigation apps can replace GPS units at no extra cost, and parents can often check car seats on flights for free, avoiding rental fees altogether.

Protect yourself

The reality is that the rental industry profits heavily from these practices. In 2024, U.S. car-rental companies collected more than $2 billion in optional insurance and add-on fees, a significant portion of which came from products renters didn’t truly need. Legal challenges have occasionally forced companies to settle claims over hidden fees and false damage charges, but systemic issues remain.

Navigating this environment requires preparation and awareness. Researching rental companies in advance, documenting the condition of the vehicle, confirming coverage with your insurance and credit card, and reading the fine print of agreements are essential steps. Avoiding high-pressure sales tactics, understanding the cost implications of upgrades, and planning for return times can save significant money and prevent unpleasant surprises.

While consumer advocacy and regulation are slowly increasing transparency, renters remain the first line of defense against these tactics. Until industry-wide standards are strictly enforced, vigilance is essential. Understanding how companies maximize profits and where they might bend the rules puts you back in control of your rental experience.

Renting a car doesn’t have to be stressful. With careful planning, attention to detail, and knowledge of potential pitfalls, travelers can avoid unnecessary costs and enjoy a smoother, more predictable journey. In the world of car rentals, the most important tool is not a GPS or a car seat, it’s knowledge.