Question: When renting a car with Hertz at the Norman Manley International Airport in Kingston recently, I was told that I could not insure the car because of my age. I will be 69 this year. I had to take full responsibility for damage and loss. That came as a shock to me!

I was informed that other rental companies had a similar policy. I had no choice but to sign the company's waiver. When I checked with Avis later, I learned that I had been misinformed. That company does not discriminate against persons like me.

I found the experience very embarrassing. Shouldn't a country that promotes itself overseas as a destination for business and leisure have sensible policies to cater to visitors like me?

- H.C.C.B.Y., Switzerland.

Answer: I am sorry to learn about the discomfiture you suffered. Thanks for taking the time to write about the problem. The tourism ministry, the marketing/promotion organisation, licensing entity, the particular rental company, insurers and others should each say mea culpa for what took place. It ought not to have happened. I propose to use this medium to put the matter in context and, hopefully, start a process which will prevent something like this from taking place in the future.

Motor insurance compulsory

Third-party liability insurance for motor vehicles that operate on public roads in Jamaica is mandatory. It is required by law.

This is not unlike what happens in most countries, including Switzerland. Jamaica's Motor Vehicles Insurance (Third-Party Risks) Act - which was passed over 70 years ago - states this and sets out what are the minimum-coverage limits for personal injury and property damage in the event of a collision.

Clerk in the dark

The rental clerk at the airport was, presumably, unaware of this. It also appears that she was ignorant about the provisions of the (collision damage) waiver in the company's rental agreement and that when you signed the agreement you were actually protecting her firm - not other road users as the law requires.

Only two or three of the companies that are licensed to transact motor-vehicle insurance in Jamaica write coverage for car-rental operators. This is one of the problems that these operators face. For example, the island's biggest motor insurer is among those that shun this type of business.

The reason is simple: the available evidence suggests it is unprofitable. I have not seen any numbers to confirm this directly, but I know that the industry reported an underwriting loss of $419.2 million on gross premiums of $11.3 billion last year. These results applied to all vehicles.

The reported loss in 2007 was $339.4 million on premiums of $10.2 billion. In 2006, the loss was $897.3 million on premiums of $8.2 billion. These numbers, in my opinion, provide clues as to why most motor insurers are reluctant to insure these types of vehicles.

A Hertz official told me the age limitation was imposed by its motor insurers. It applies to young and mature drivers. She appeared to be unaware that the Avis rental contract does not exclude persons 65 years and older.

I learnt afterwards from an insurance company source that they are "quite flexible" about the provision regarding persons 65 and older. In other words: they would be willing to raise the age limit on request. It was not clear whether Hertz was aware of this fact, or had sought to negotiate a change.

A Problem in Hiding

Many years ago, all motor insurers in Jamaica created an entity - the Jamaica Claims Bureau - to offer coverage to car-rental companies, public-passenger vehicles and other entities that were involved in providing ground transportation to the tourist and other sectors.

The operations of the entity were discontinued, presumably because it was bleeding the industry. The market has not provided an alternative. In the meantime, the Government appears to be busy dealing with other pressing issues to the detriment of matters like these.

My wife and I shared pleasantries with a Swiss couple in rural Jamaica a few months ago. They hired a motor vehicle and had driven around the island.

Some weeks later, we had a long discussion with a young professor from the United States who sought information about where to visit during a one-week visit here and whether he should hire a motor vehicle to drive around the island.

Encounters like yours and those of my wife and me demonstrate the fact that ground transportation plays an important role in Jamaica's tourism product.

It is, therefore, very important that measures are put into place to ensure compliance with our laws. Also, that those visitors who hire motor vehicles can be assured of some protection as the law envisages.

Cedric E. Stephens provides independent information and free advice about the management of risks and insurance. Email: aegis@cwjamaica.com or text (SMS) message to 812-7233.