Rental agents are generally paid on commission (for add-ons and upgrades). They will try to offer you all sorts of add-ons including insurance. It's your option to accept or decline. In this case, the customer should have brought up the issue when she was at the rental counter. Once you've driven the rental for a week or whatever, you've already consumed the service, so it's not surprising that they would push back on refunding.

That said, if the agent was deceptive in either nor disclosing the insurance charge (as she alleges) or did not properly advise her of her options, then shame on the company. Does this happen at Thrifty sometimes? Does this happen at other companies as well? Yes it does, but it definitely is more prevalent at the discount companies--especially at Payless.

Note that many rental locations record (audio and/or video) their interactions with customers. In those cases they can review this after the fact to see if things were handled properly. A customer might want to inquire about this if there is a dispute.