Car Hire Excess Insurance - Car Rental Excess Insurance
Protect yourself against paying the excess if you have a scrape in your hire car abroad with car rental excess insurance. Car rental insurance covers your rental car excess payment - which could cost up hundreds of pounds - when you take out a hire car.Selecting the "get a quote" button will direct you to Insurance 4 Car Hire.
Posts Tagged ‘Rental Car Hire Insurance’
Purchasing car excess insurance
You’ve hired a car, picked up the keys and the person behind the desk offers to sell you car excess insurance cover.
At this stage in the game, the question you may be asking yourself is why you need any more insurance at all, since you had assumed that your rental came with all the required insurance included in the hire price.
The answer to your question may well be that, yes, your rental does come with insurance included and you could very probably just get in the car and legally drive off.
There may be a problem with this though, which arises from the fact that collision damage waiver (CDW), the cover provided by car hire companies, typically does not provide 100% protection.
Your agreement may stipulate that you are responsible for the excess, which could be anywhere between £500-£1600. In addition to this, you’ll typically also find that damage to certain other parts of the car will be excluded from the CDW and so will remain your responsibility.
Buying car hire excess insurance may cover this potential expense for you and may even include the parts typically excluded by the rental company’s CDW.
Buying car hire excess insurance from the car hire company is obviously one option. It may not be the most cost effective solution but if you are at the point of picking up your keys then it may be your only option.
Using an online car rental insurance specialist may give you a bit more choice when it comes to buying car excess insurance and hopefully that could mean you can choose the deal that makes sense for you.
Taking out rental car hire insurance
Rental car hire insurance typically takes two main forms
There’s third party liability cover, which protects you financially if you damage some else’s property or injure them with the hire car.
Then there’s typically a collision damage waiver (CDW) that covers you for damage to the hire car itself. This typically also includes the theft of the car.
Third party cover
If you are hiring a car for use in the UK and certain parts of Europe, then third party liability is likely to be unlimited. This means that if you are sued for damaged, your insurance will cover the costs no matter how high they are.
In some other countries, like the USA, third party liability is likely to be limited which means that potentially only part of the costs would be covered and you would have to fund any shortfall yourself.
In that case, buying Supplemental Liability Insurance (SLI) may typically make sense given the size of potential court awards for damages.
Collision damage waiver
Typical CDW cover tends to carry an excess.
This is the amount of money you would be expected to pay towards any damage to the rental car. Not only that but certain parts of the car may be excluded from CDW cover.
That could mean that you may have to pay significant amounts towards repair costs for the hire car in the event of damage.
You can buy car hire excess insurance to cover yourself against having to pay these charges and you may find that specialist rental car hire insurance companies can offer this excess insurance at prices that may be more cost-effective than those on offer from the car hire companies.
Why take out rental car hire insurance?
If you have seen a product advertised called rental car hire insurance, you might be asking yourself why you would pay for cover when you already have insurance included in with the cost of the car hire.
The benefits to insurance for rental cars
It’s true that when you hire a rental car you typically have insurance in with the price of the car hire, or you buy it as an add-on. The insurance policy provides you with cover in the event that you have an accident in the car and damage a third party’s vehicle, property or injure a third party. However, as with all forms of insurance, there is always a certain amount of excess that you have to pay towards any claim you make, and the same applies to the protection you have for the rental car.
This is when excess for rental car hire insurance comes into its own as it typically pays the excess (in the event of a successful claim and up to set limits). Imagine having an accident in your rental car that adds up to many thousands of pounds worth of damage?
The excess on this could easily run in to over £1,000 and if you do not have insurance to cover it, this money comes off your credit card. The rental car provider has your credit card number from when you rented the car and takes the sum of money from your card, potentially leaving you with a debt to pay off. This could make your driving holiday a lot more expensive than you could ever imagine.
Providing you have excess rental car hire insurance to fall back onto you simply claim on the insurance policy and the provider repays you an amount equivalent to the excess (subject to terms and conditions) which allows you to pay it off your credit card balance. This type of policy may be worth considering as it may also cover any parts of the rental car that are not covered in the insurance policy that is included in with the cost of renting the car.
Beginners guide to rental car hire insurance
If you’re not familiar with car rentals and rental car hire insurance, it can all seem a little bit confusing.
In general, the insurance industry LOVES acronyms and throws them around liberally such as CDW, SUPER CDW, TPF&T and so on. Fortunately, the reality is in fact fairly simple once the basics are understood. We’ll try here to de-jargonise some of all this for you through some basic questions and answers.
Who sells rental car hire insurance?
The rental car company may include some insurance components in the rental price. If not, they will certainly try their best to sell it to you as an optional extra.
You will probably find though that their insurance is several times more expensive than the same insurance purchased on the open insurance market through the Internet. There are specialist providers of such insurance and not only will you find their prices to be cheaper but also the cover they provide will probably be superior.
Is insurance obligatory?
It depends what you mean. In most countries some form of minimum insurance is often a legal requirement. In others it may not be. Your hire company would advise you on that or you could research it on the web.
Remember that even if insurance isn’t a legal requirement in the country you’re renting in, driving without it could be very, VERY risky. If you do not have insurance and have an accident then you could be held responsible for all costs involved and need to pay them out of your own finances. As the claims could go well into 6 or even 7 figure sums, insurance is usually highly advisable.
However, if you were wondering whether or not it is obligatory to take the rental company’s insurance, then the answer is ‘NO’.
Even if they have included insurance in their rental deal, you can ask them for a ‘rental only’ price and then compare that against using your own insurance purchased on the Internet. You may be surprised at how much money you could save though you may not be able to do this if you’re renting through a fly-drive holiday or on a ‘special offer’ basis.
What do all these acronyms and ‘types of insurance’ actually mean?
The insurance on your rental car will probably break down into two main areas. The first of these is called Third-Party liability and protects you against claims from other people that you have injured them or damaged their property with the rental car. In many countries this is the legal minimum insurance you must drive with.
There is then something called ‘CDW’ which stands for collision damage waiver. It covers you against any damage caused to the rental car while it’s out on rental to you. This usually includes cover against theft but it’s worth checking to be sure.
How can privately purchased rental car hire insurance be ‘better’ than the rental company’s?
You may find that the basic insurance offered by the rental companies is limited. It may contain excess (an amount towards any claim that you’ll have to pay) of between 500 and 1500 pounds. It may also exclude several areas of the rented vehicle from its damage cover.
If you wish to avoid this, you will have to pay the rental company for extra insurance – often called ‘top-up or ‘SUPER CDW’.
The policies purchased from the specialist providers may not contain such exclusions and limitations.
Where can I find out more?
The web sites of the specialist providers usually contain excellent detail on these subjects and are aimed at people with no specialist knowledge of rental car hire insurance. They may be worth checking out.