Insurance Exclusions and Compensation Terms

Among these, tires, wheel covers, keys, incorrect fueling, interior soiling, and off-road damage are commonly listed as exclusions under the standard compensation systems of major Japanese car rental companies. For example, Japanese rental companies explicitly state that tire punctures, lost wheel covers, lost keys, incorrect fueling, and damage from off-road driving (such as on coastlines or riverbeds) are the customer’s responsibility.

However, these exclusions are not uniformly mandated by law — for instance, some rental companies’ enhanced protection plans additionally cover tires, wheels, interior equipment, mirrors, and wipers.

1. Failure to Handle an Accident Lawfully

• Not stopping the vehicle immediately
• Not assisting injured parties
• Not reporting to the police
• Failing to obtain a traffic accident certificate
• Not notifying the rental company at the accident scene
• Leaving the accident scene without authorization

The legal basis is Article 72 of Japan’s Road Traffic Act, which requires a driver involved in an accident to stop the vehicle, assist any injured persons, prevent further danger, and report to the police. The Ministry of Land, Infrastructure, Transport and Tourism’s reference rental terms and conditions also require that, regardless of the severity of the accident, statutory measures must be taken immediately and the rental company must be notified.

2. Illegal or Serious Breach of Contract Driving

• Drunk driving
• Driving under the influence of drugs
• Driving while impaired and unable to drive safely
• No valid driver’s license or an expired license
• Invalid international driving permit
• Driving by someone not registered on the contract
• Unauthorized subletting or handing the vehicle to a third party
• Speeding, racing, or dangerous driving
• Extending the rental period without authorization
• Using the vehicle for criminal activity, competitions, or testing
• Settling privately with the other party without consent
• Refusing to provide accident information
• Providing false information
• Failing to cooperate with investigations by the police, insurance company, or rental company

3. Intentional Acts or Gross Negligence

• Intentionally causing a collision or damage
• Deliberately entering a closed road
• Deliberately driving through deep floodwater
• Continuing to drive despite a known warning light
• Continuing to drive with a known tire leak
• Failing to apply the parking brake, causing the vehicle to roll
• Leaving keys in the vehicle, resulting in theft
• Forcibly operating wipers, power doors, or mirrors while frozen

The legal basis primarily comes from Article 17 of Japan’s Insurance Act: where damage is caused by the intentional act or gross negligence of the policyholder or insured, the insurer may, in principle, be exempted from payment obligations. Liability insurance handles gross negligence differently, so the specific policy terms must still be consulted on a case-by-case basis.

4. Improper Use or Management

• Lost or improperly stored keys
• Vehicle stolen due to not being locked
• Incorrect fueling
• Using the wrong power source or external equipment
• Overloading or improperly loading luggage
• Driving on beaches, riverbeds, forest roads, or other non-public roads
• Towing another vehicle without authorization
• Removing or modifying equipment without authorization
• Smoking inside the vehicle
• Soiling caused by pets
• Severe soiling from vomit, beverages, or food
• Water damage, flooding, or salt damage to the vehicle
• Failing to follow the rental company’s instructions when handling a breakdown

Natural Disasters Cannot Simply Be Written Off as Uncovered

Whether damage from typhoons, floods, hail, snowfall, earthquakes, volcanic activity, and similar events is covered depends on the insurance policy.

This should be divided into two categories:

• Unforeseeable, unavoidable disasters: May fall within the scope of vehicle damage insurance coverage.
• Cases where road closures, warnings, or clear danger already existed, and the traveler proceeded anyway: May be deemed a breach of the duty of care, gross negligence, or a violation of the rental terms, and therefore not eligible for compensation.

Situations Where Insurance and Compensation Systems Do Not Apply

Even if the traveler has enrolled in basic insurance, the deductible waiver, NOC compensation, or the Peace-of-Mind Plan, full or partial compensation may still not apply in the following situations: failing to report the accident to the police and to our company; being unable to obtain an accident certificate; driving under the influence of alcohol or drugs; driving without a valid license; driving by a person not registered on the contract; intentional acts or gross negligence; dangerous or illegal driving; unauthorized extension or subletting of the vehicle; unauthorized private settlement; providing false information; refusing to cooperate with an accident investigation; and other violations of the rental agreement or insurance terms.

Tires, wheels, wheel covers, windshield damage from flying stones, the vehicle’s undercarriage, suspension system, the area beneath the bumper, keys, interior equipment, accessories provided with the vehicle, incorrect fueling, water fording, interior soiling and odors, and damage caused by off-road driving are, in principle, not covered under our company’s deductible waiver or NOC compensation. Repair, cleaning, towing, parts delivery, and other related costs are the traveler’s responsibility.

Whether single-vehicle incidents such as self-collision, rollover, falling, or striking a fixed object are covered by vehicle insurance will be determined based on our company’s actual insurance contract and the insurance company’s assessment; where our compensation system explicitly excludes coverage, the cost is borne by the traveler. All compensation is ultimately subject to the insurance company’s assessment and our company’s rental agreement.