I don't think that is correct - For several years now I have bought an "International Driving Permit" from AAA in the USA and it has been accepted by all the rental agencies we have used on Cayman.
This information was obtained by talking with some of the rental car agencies we work with, RCIPS police officers, and DMV employees.
All the international divers license does is translate your state-issued license into another language. That's it. You can not obtain an international drivers license in lieu of a state DL. The AAA is not a government agency, and has no authority over another countries laws, or even US State laws for that matter.
A country may set its own laws, and of course one country cannot tell another what they may or may not accept to drive here in Cayman. Some counties will accept an accredited IDL to operate a motor vehicle. From what I was told, Cayman is not one of them. International drivers license are have no mention at all in the Cayman motor vehicle code. If you were stopped in Cayman for a moving violation, or had an accident, you would be legally required to show your state-issued ID. Showing an international driver's license alone would not suffice. Remember, all it is, is a translation, and since Cayman is an English-speaking country, it's not needed.
One of the managers of the local Dollar Rental says he does not accept them. Now then, some rental agencies do. The gist I seem to be getting is a lack of understanding of what the IDL really is, and how it works. This doesn't seem to be limited to rental companies - some police officers do not fully understand the International Driver's License. I was told some will accept it if handed, not understanding what it even is. Technically this is not within Cayman law. Cayman police have a reputation of not really bothering tourists, unless you do something really stupid anyway.
Those who know and understand what the IDL is, don't accept it, unless it is accompanied by a state-issued ID.
Our advice for those who wish to rent a car here is to save your time and money with the IDL. Get the Cayman permit. Make sure your auto insurance or credit card insurance covers you in the Cayman Islands, and drive carefully.
I doubt that the AAA would run a scam, and I doubt that the Caymanian rental agencies would accept it if it were....
We are not saying AAA is running a scam - they are very reputable, and they are one of the few companies authorized by the Department of State to issue such a document. But if you google 'international driving license' you will find hundreds of companies that aren't authorized to do such a thing, and are really just issuing you a worthless card for money.