CDW insurance is known as collision damage waiver insurance. When you rent a car you may have some form of insurance included with the rental fee, or you may be asked to take out rental car insurance. When you take out insurance, the policy comes with a certain amount of excess the provider expects you to pay in the event of a claim (this will be a sum of money). This is where a rental car excess insurance policy or CDW comes into play.

Say you were in a collision with another vehicle, or you hit a brick wall surrounding a property. You are probably able to claim on your rental insurance for the damage caused. Fair enough, but you still have to pay any excess – and this may be a large amount. With CDW insurance to fall back onto, typically you are able to claim on the policy and this typically covers your excess charge for you, or so much of it.

Without CDW insurance, you could find yourself facing unexpected costs in the event of an accident or damage to the vehicle (even damage that was caused while you had left it parked somewhere). With a car hire excess insurance policy behind you, if you make a successful claim, potentially you may only have a small portion to pay towards the excess.