A few months ago I travelled to Queenstown in Tasmania to speak at two Christmas parties for Tasmania Copper Mining. It meant quite a bit of driving, and a renewal of acquaintances with hire car contracts. The article appeared on Tony Martin’s Scrivener’s Fancy site.

I’m insulted that the Hertz attendant even feels the need to ask. ‘Sir, would you like to reduce your damage liability today by purchasing some insurance? It’s an additional $35.70 to reduce it to zero or $27.80 to reduce the damage excess to $500.’

Surely it’s obvious from my rugged appearance? Isn’t my stubble a little bit Indiana Jones-ish? Didn’t our earlier banter about the fading change-of-address sticker on the back of my licence card paint me as a devil-may-care maverick? If I had a stock whip, this would be the moment to crack it, break into a lopsided grin and say, ‘Today, I’m feelin’ lucky. Today, no parachutes.’

Unfortunately, the hire car attendant couldn’t detect my inner movie star. She could only see a once blonde, now balding buffoon making a poor show of flexing his triceps and achieving a mouth position that was more Jerry Lewis than Harrison Ford. She waved the pen over the contract.

‘And so, would you like that excess reduction?’

‘Um ... no, I’ll pass.’

‘Okay, so just confirming that’s a maximum $3300 loss or damage liability payable irrespective of fault. And it’s a maximum $9900 if you damage the car on an unsealed road.’

Jerry Lewis’s eyes bulged. These were serious numbers. I’d only recently sold the second car and pledged to the world of bicycles, taxis and occasional car rentals to avoid numbers like these. Three thousand three hundred! Nine thousand nine hundred! Did a gravel driveway count as an unsealed road? My throat felt dry. I had to remind myself that maverick adventurers rarely concern themselves with fine-print haggling. They just close their eyes and sign. I did just that and, as a result, missed the signature line by a considerable margin.

The attendant smiled, handed me the large keyless key, and told me that with the new Nissan Maxima, you can start the motor just by pressing the start button, so long as the remote key is in your pocket. I grinned and said something like ‘I guess I’ll become a fair bit more productive now that I don’t have to waste time putting the key in the ignition.’ She laughed, and we left on good terms, and I never told her that her company, its bosses, its board of directors and the entire hire car industry, are money-grabbing scumbags that prey on ordinary people’s fears and impecuniousness to gouge profits.

Is there any product on earth, outside the world of homeopathy, that is marked up as much as hire car insurance? My own annual insurance outlay on a VW Passat Wagon is $1041. If we assume hire car companies are paying something similar, it takes just twenty-nine rental days to recoup the premium. That leaves 336 days for profit making. My maths puts it as a potential $11995 per car per year. Even if a car is only rented (with insurance) on fifty per cent of days, that’s still nearly $6000 per car per year.

Given that daily rental prices are now extremely competitive – the tariff on my Maxima was just $67.10 per day – it’s entirely possible that the profit strategy for hire car companies is built around insurance.

They therefore have to strongly encourage — or perhaps a better word is ‘terrify’ —customers into taking it. They are doing this by simply raising the damage liability for we Indiana Jones types who don’t want to pay for the worst-value insurance in the world. I walked grumpily to my magical keyless Nissan, imagining the meetings of upper management:

‘Hey, Christophe … we’re only getting a thirty-eight per cent uptake with the excess at $1800 …’

‘Well, let’s see how they stomach $2500 …’

‘Hey, Christophe … that increase didn’t make much difference.’

‘Okay then … we’ve got to think of a truly devastating financial penalty. We’ve got to have them thinking that it’s hardly worth surviving the car crash because of the years they’ll be spending in a nineteenth-century debtors’ prison. Is $3300 going to do it?’

I’m perhaps being a bit hard on Christophe, putting words in his fat, profits-loving mouth. He may not have mentioned debtors’ prison — unless his daughter, like mine, is going through a Nanny McPhee stage. And he is almost certainly not called Christophe, which is the name of a mean kid I used to do tennis lessons with twenty years ago and who, as a consequence, gets to be the baddy in a lot of my boardroom fantasies. But leaving aside these particulars, the gist is there.

Hertz is not alone in adopting the ‘terrify them into paying an extra fifty odd percent’ policy. At Avis, the damage stick is $2915 reducible to $330. At Budget, it’s $2846 reducible to $341. And at Thrifty, single-vehicle accidents can cost $5500 and multi-vehicle accidents $3300, reducible to $385 or zero. Christophe works at all the majors, it seems.

The ACCC should look into it. Hire car companies have so far successfully argued that there is nothing misleading or deceptive about their prices. Brave customers can, after all, drive a car at the advertised tariff. But, in my view, they’re playing dirty pool with the fine print. It might be legal, but it’s sneaky. Like banks making their real money from fees. Like budget airlines scooping the real cash out of excess baggage charges. The advertised price is not the ‘real’ price, because once the terrifying liability clause has done its stuff, it’s fifty per cent higher.

It’s also a tactic that preys on poorer consumers. A wealthy customer can take his chances with these fierce damage liabilities — it won’t break the bank if the worst happens. A poorer customer will decide it’s better to be safe than sorry, and pay for her inability to buy her way out of trouble.

I made it to my car and inserted the key, before I remembered that I didn’t have to, and so removed it again. I then decided that the key slot was still as good a place as any to keep the key, and so reinserted it. This tripled the normal time it takes me to start the car.

A piece like this should end with me catapulting into a ditch on an unmade road, a vain search for ten grand, a lengthy legal battle, bankruptcy, and revelations that my four-year-old daughter is working as a chimney sweep to help make ends meet. Instead, it ends with an event-free trip, some pretty scenery, a key return, and some more smiles.

Tony Wilson is the author of the comic novel, ‘Making News’. Here’s a very good review.

You can follow Tony on Twitter @TinselTone