The Specifics Of Car Rental Insurance Policy Cover
Car insurance for hire cars is often complicated which puts many people off from buying it.
It varies quite notably depending upon where youre renting the car (which country) and the hire company youve chosen.
What follows here, therefore, can only be a brief overview and it should not be seen as a substitute for making detailed inquiries with your rental company.
Also note that exclusions and limitations will apply normally apply within the terms and conditions of the car rental insurance and you should read these carefully to ensure you understand them.
Legal jurisdiction
The country in which you take out your rental insurance will usually state what insurance you need when hiring your car.
In most countries this is typically third-party liability cover.
Knowing that is important but its not the whole story. Thats because you also need to know the legal minimum amount of financial cover provided.
In some cases it could be very little, while in others it may add up to a great deal. Not much use if a court has awarded 500,000 dollars in reimbursement against you.
In the UK and some other countries, the rental car by law must come with third party cover offering unlimited financial protection.
If thats not the case in the country youre hiring in (and in the USA the statutory minima may be very low) then you may wish to think about supplementing your public liability cover through additional insurance.
Protection against damage to the vehicle
Understanding your liabilities to third parties is not the only aspect to consider because youll also have to pay for any damage to the rental car if your car rental insurance coverage doesnt include CDW.
Some car rental companies may offer you insurance that comes with CDW already included, or you could have to take it out on your own.
Although having CDW included in the rental deal may look fantastic, it isnt the end of your financial risks because:
not all areas of the rental car will typically be covered by the CDW;
your insurance policy may carry a meaty excess of up to £1600 the sum you may have to pay as the first part of any future claim.
Additional insurance
So, in spite of having insurance apparently included in the rental deal, in reality you may still have considerable financial exposure in the event of an accident.
If you dont like the sound of that, you can remove that risk and improve your car rental insurance coverage by purchasing whats called hire car excess insurance policy.
If you shop around for the insurance you may be able to make considerable savings on cover. It works simply by reimbursing you for any excess or excluded area damage payments that come your way from the car hire company, subject to terms and and conditions.
It might be worth thinking about increasing your car rental insurance coverage in that fashion unless you like potentially large and unexpected charges to your credit card!