Why consider car hire excess insurance?
If you are considering renting a car either in the UK or overseas, you may typically be given some form of insurance in or on top of the rental cost. However when you take a look at the small print of the rental insurance you usually find that some aspects are not covered and of course there is the excess to consider. The excess is the first part of claim that you will be liable to pay and could range from £400 up to and over £1,500 depending on the car hire company.

What is car excess insurance?
As the name suggests excess insurance may be taken out to cover the excess that you may have to pay in the event of making a claim on your car rental insurance. If say you had an accident in the rental car you have so much to pay towards the claim before the insurance provider pays the rest. This is typically taken from your credit card and may be costly.

Car hire excess insurance helps pay towards this excess or it may pay all of it all depending on the policy you choose and the provider. Of course the policy does not stop the rental car provider taking the excess from your credit card, but you may claim it back from your excess insurance policy. When you consider the potentially staggering amounts you may be billed for in excess an excess insurance policy may save you a great deal of money.

If you are renting a car, the company you are renting from may ask you to purchase insurance. This insurance works very much in the same way as general car insurance. If you were to suffer an accident or the rental car was written off, you may claim on the policy. If you injured someone in the rental car or damaged a third party’s property the typical rental insurance policy covers this. A car hire excess policy may be taken out on top of your rental insurance to help with the costs for excess, if a claim is made on your rental insurance.

How much is the excess on a policy?

The amount of excess you may have to pay typically depends on your rental company. Some may ask for a lower amount than others. Whatever the amount of excess, this is money that has to be found out of your own pocket. However, with a car hire excess insurance policy behind you the financial costs for the excess generally come from the insurance policy. Your excess policy may cover the whole amount of the excess or up to so much of it. Even if you have to pay a small amount of the excess yourself, the insurance may save you a great deal of money in the long run.

So where might I get insurance for the excess?

The car rental company may ask you to take insurance from them, and they may even offer car hire excess insurance. However, you may be able to make savings on the cost of the insurance premiums simply by going to a specialist hire car excess insurance online provider. When taking on any form of insurance there are typically terms and conditions, so always ensure that you have checked these. Finding out that you cannot make a claim on the policy when you need may be devastating financially.

Anyone renting a car may wish to consider car hire excess insurance. This type of insurance may potentially save you money if the worst case scenario were to occur.

What are excess charges?

When renting a car you usually have some form of insurance with the company you are renting from. This insurance typically provides protection against damage to the rental car, along with liability insurance for the third party. Typically a policy comes with what is known as excess. This is the amount that you need to pay if you make a claim before the insurance company takes over the rest of the claim. Typically this amount is taken off the credit card you paid with when renting.

What does the policy cover?

Car hire excess insurance typically covers or reduces the amount of excess you have to pay, up to a set limit.

Frequent users of rental cars

If you are a frequent user of rental cars you may be wise to check if you are able to take out an annual rental car insurance policy.

Typically car hire excess insurance is taken out at the time you hire a car. However you do not have to take out excess insurance with the place you hire your car from, you are able to search for a policy independently, and this may be a suitable way to save on the cost of cover. As with any type of insurance policy always check over the small print of any rental insurance you are offered.

Car hire excess insurance is an additional form of insurance protection that relates to the use of hired cars.

If the idea of purchasing ‘additional insurance’ for a rented car doesn’t immediately seem to sound like the best idea you’ve ever heard, it may pay to read on. You may save yourself some serious amounts of money!

Rental company insurance cover

The rental company’s insurance whether purchased separately or included in the rental cost, typically provides cover against third-party claims (third party liability insurance) and damage to the rental car (CDW or Collision Damage Waiver).

It may also come with what’s called an ‘excess’.

The excess is a financial amount, usually set between £500-£1500, (though it can vary from this) that you agree to pay as the ‘first part’ of any future claim during your confirmation of the booking and signing of the contract at car collection.

Once in place, it means that you may find significant amounts of money being billed to your credit card after an accident.

The maths is typically pretty simple. If you have an excess of £750 and there is a £500 repair bill to the hire car following an accident, you will find the entire £500 billed to your credit card. Had the damage cost £1000 to repair, you would have been billed for £750 as the full excess and the rental company’s policy would have paid the remaining £250.

Protecting yourself against excess charges

The excess constitutes a considerable financial risk for renters and the hire companies recognise that fact.

They may offer the option of protecting yourself further by paying them additional sums for what they sometimes call ‘top-up insurance’ or perhaps ‘Super-CDW’. For an additional sum, this form of additional car hire excess insurance will typically reduce or even possibly remove the excess from the policy.

What the car rental company may be less inclined to tell you though, is that you may be able to achieve the same degree of protection (or possibly even more) and at a lower cost by purchasing your car hire excess insurance not from them but from an Internet based specialist provider of car rental insurance.

The Internet car hire excess insurance market

On the Internet there are companies that specialist in car rental insurance cover and typically their prices will be lower than those of the rental companies. They also sell something that they may call ‘excess insurance’ and if you are charged an excess by a rental company, then all you have to do is get this reimbursed to you through your own direct excess policy.

Another potential advantage of purchasing this insurance from a direct provider is that they may also offer it on an annual basis. If you have an annual policy then subject to a few restrictions around specialist vehicle types (e.g. sports cars) it would typically provide financial protection for any vehicle you rent during the life of the policy.

If you rent regularly or even more than once in a year, an annual policy may offer even more scope for saving both time and money.

The car hire excess insurance sold by the specialist providers may be worth investigating further if you’d like to improve your peace of mind when driving that hire car.

Many people have signed a car hire agreement while quietly wincing at the excess which is attached to the insurance part of the contract. This can be anything from a couple of hundred pounds all the way up to more than a thousand depending on the country and the vehicle. In effect this means you will be liable for this initial cost if there is any damage regardless of whether or not it was your fault in most cases. However, there is a way to protect against this potentially irritating and costly expense – car hire excess insurance.

When you hire a vehicle in a number of countries including the UK, most of Europe, Africa, Australia and New Zealand and most of the middle and far east, collision damage waiver, theft and third party liability are often included in the rental car price. Fortunately there is pretty much always an excess which can sometimes be referred to as the non waiver or deductible – this is the potential cost which is protected by your car hire excess insurance policy.

What normally happens is that car rental company will take your credit card number upon signing car over to you – this is so they can simply remove the excess from your card in the event of a collision, theft or similar problem – but if you have excess insurance you can simply claim is back.

Typically, all you would have to do is call a helpline within a set time frame from the incident or on your return from your holiday, whichever happens sooner. You will be asked some basic information about your claim which will then processed, and subject to acceptance, you simply have the annoying excess fee refunded to you.

Although depending on where you’re going the excess can be referred to as the super CDW non waiver or deductible, they all refer to essentially the same thing which means a potential cost – this can be particularly infuriating if something happens which was not your fault, i.e. the badge is removed from the car in an act of vandalism overnight.

A car hire excess insurance policy covers most vehicles but may not protect certain types. Typically this includes recreational vehicles including off road vehicles, vans, trucks, motorcycles, and motor homes. Besides this, you’ll be protected provided you hire the vehicle for a reasonable distance away from your home address – normally at least 25 miles.