Problems for rent-a-cars.

A large number of Balearics' hire cars could be forced off the roads this season because of a sudden and sharp rise in the cost of insurance policies which in some cases have shot up by 140 per cent. The President of the National Federation of Resort Hire Car Companies, Manuel Jiminez, said in Palma yesterday that some of the independent rental companies hit with large increases in the costs of their insurance policies cannot afford to pay and are being forced to withdraw vehicles from service. Jiminez warned that unless some form of action is taken then a large part of the country's fleet of hire cars will be “paralysed.” Last month the Bulletin revealed that Lloyds of London is no longer insuring rental vehicles and the National Federation stepped in to try and help those companies affected to find alternative insurance companies. It appears that all the Federation has discovered is that insurance companies have increased their rates. “Without insurance, vehicles will not be on the roads, car hire companies cannot meet such high policy tariffs,” Jiminez said. The national president is also president of the Balearic association and Jiminez said yesterday that there are 14'000 vehicles in the Balearics which are suffering insurance problems. If the 14'000 vehicles are not back on the roads by Easter and the start of the summer season, the Balearic car hire sector will collapse under the weight of huge demand.


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