Protect Your Excess

Collision Damage Waiver insurance is the basic form of insurance for car rentals which covers damage to or theft of the rental car. By taking out the waiver, the renter of the car passes on their responsibility for the cost of the damage or loss, to the insurance company.

Some car rental companies now offer rental terms, which may include Collision Damage Waiver Insurance as part of an all inclusive rental package – the daily rental rate quoted will include an allowance for insurance. Others will quote you a much cheaper daily rental rate and show the insurance costs separately.

Collision Damage Waiver insurance bought from the car rental company generally comes with large excesses and some exclusions.

The excess amount is the level of cost above which the collision damage waiver policies will start to pay out. All costs for damage to the rental vehicle at or below this value will have to be paid for by the renter of the car. Since excesses can range from between 500 to 1500 pounds this can result in a hefty bill should the car suffer damage.

The exclusions on the policy relate to areas of the car like the windscreen, roof, tyres and undercarriage. They are excluded from the policy – they are not covered. If something happens to them you have to pay for their, potentially expensive, repair or replacement.

So while Collision Damage Waiver insurance may be an essential part of your car rental insurance, it is not necessarily the whole story.

No matter how it is calculated, when renting a car it is your responsibility to make sure that you are happy with the level of insurance cover offered. If you think you need more then you should perhaps consider buying more.

You can take out additional insurance to cover the exclusions and the excesses of your CDW policy. This can be bought either from the car rental company or from an specialist insurance company. Many of these specialist insurance companies can be found on the internet and you may be surprised at how much cheaper their rental insurance can be when compared to the equivalent level of cover from the car rental company.

One interesting product that the direct hire car specialists can offer is an annual excess policy to top up the Collision Damage Waiver. When bought from the car rental company, this will provide cover calculated on a daily basis for the duration of the rental. The independent companies however have annual policies, which can be used over the course of the year for a number of rentals. These polices may offer significant savings particularly if you know that you are going to be renting a car more than once in a yearly period. There are terms and conditions which you will need to comply with, but you should be able to find something to meet your needs.

Nobody wants to have an accident or damage their rental car but knowing that your Collision Damage Waiver Insurance together with an excess top-up gives you complete cover can offer welcome peace of mind leaving you free to enjoy that holiday or business trip.

Repairing cars can be an expensive business. However minor ‘the bump’, the bills generated can be vast. This applies just as much to rented cars as private vehicles and it may be advisable to consider CDW insurance if you wish to avoid some very large charges to your credit card by the rental company for repairs.

CDW insurance (also called Collision Damage Waiver or just Damage Waiver) exists to cover the renter of a hired car against damage that he or she may do to it. CDW insurance may be included in the basic rental cost of the car and when it is not, the rental company will most likely offer it to you as a purchasable extra.

If you do take or purchase CDW insurance from a rental company, you may wish to check two things if you wish to completely avoid the risk of needing to pay out large sums following an accident. The first of these is whether or not the policy carries exclusions. These are usually listed as areas of the vehicle that are not covered by the CDW policy. Typically these cover areas such as the windows, roof, tyres, wheels and general undercarriage. If they’re damaged and listed as exclusions, you will have to pay.

Secondly, remember to check the excess. The excess is normally quoted as a financial amount between 500 and 1500 pounds. It is the amount that the car rental company would expect you to pay as a contribution towards the cost of any claim. In other words, if there is 500 pounds excess and a claim totalling 1000 pounds for damage, you will be expected to pay the 500 pounds. If the damage costs only 300 pounds then you will have to pay it all.

You can pay the car rental company additional sums of money to improve this cover by removing the excess and extending cover to other areas of the vehicle. Most people find though that this additional insurance is extremely expensive when compared to the outside marketplace and other options.

You do not necessarily have to take the car rental company’s insurance. You can purchase CDW insurance from a direct insurance company over the Internet. Their policies will usually be significantly cheaper than those of the car rental company and typically offer better cover. They may well cover all areas of the rented vehicle against damage and come with little or no excess.

Even if you have decided to take the basic CDW that comes with the rented vehicle as ‘included in the price’ you can still purchase additional insurance from the direct insurance companies to protect you against excess charges or repair bills for damage to excluded areas of the car.

These forms of CDW Insurance are usually sold on a daily or annual basis. One of the big advantages of this is that they will cover the policyholder for any vehicle rented during the life of the policy – providing that certain conditions are complied with (e.g. no sports cars). The savings here could be very substantial and it may well be worth exploring further.

In order to ensure that you are fully covered to drive your rental car you may want to consider taking out CDW Excess Insurance.

With a typical CDW or Collision Damage Waiver policy, you may find that there are still excess costs for which you would be liable in the event of the rental car being damaged.

These costs can be high, as excesses can range from between 500 and 1500 pounds. So for example if there is an excess of 750 pounds on your CDW policy and your rental car suffers damage that is going to cost 800 pounds to repair, then you would be liable to pay 750 pounds. If the damage were valued at 500 pounds you would have to pay the total amount.

Car rental companies will offer to sell you CDW Excess insurance to remove or at least reduce the amount of your excess. They will normally quote the costs of this insurance as a daily rate for the duration of your rental and this can amount to a considerable sum being added on to the total cost of the rental.

Typical CDW policies also tend to exclude damage to certain parts of the car from their cover. These are areas like the windscreen, roof, undercarriage and tyres, which are also the most likely to suffer damage. Even if you take out an excess insurance policy, you may find that you are still liable to meet the cost of damage to any of these areas.

There is an alternative to the CDW Excess Insurance offered by the car rental companies. There are a number of independent insurance companies who specialise in car rental and CDW excess insurance and you may find it worthwhile to compare their costs and levels of cover against those of the car rental companies. Even if your CDW cover has been provided by the car rental company it is still possible to look elsewhere for top up or excess insurance and you may be surprised at how much cheaper it can be.

There are a number of other advantages apart from cost savings. CDW Excess policies from independent companies often include cover for those easily damaged ‘exclusions’ providing additional peace of mind that there will be no unforeseen costs to meet.

The independent companies can supply CDW excess insurance cover on a daily basis but also as an annual policy, which can be used again and again over the course of the year. Provided you meet their conditions on the types of car that can be rented (no vintage models, sports cars or cars of very high value etc) then an annual policy could save you a lot of money particularly if you intend to rent a car more than once in the yearly period.

They have CDW Excess insurance policies available for most worldwide rental locations including the UK and have products suitable for all age ranges.

If you have independent insurance and your rental car is damaged, the rental company will charge the costs to your credit card. All you have to do for reimbursement is to claim on your CDW Excess Insurance policy.

CDW stands for ‘Collision Damage Waiver’ and although this may sound like an injury, it is in fact an insurance term used in association with car rentals.

One of the risks when driving any car is having an accident. Obviously the first concern in such a case would be the avoidance of injury to people but following on from that would be concern relating to property. If you’re driving a rented car it may not be your property but you are legally responsible for damage to it. If it is damaged in an accident and it is not insured, you will have to pay for its repair or even replacement.

That’s why most car rental companies will either include damage collision insurance (usually called CDW) in their rental price or in other cases, such as the USA, they will try to sell it to you separately. CDW means that damage to the car would be paid for by the insurance company – or does it?

It is a fact that most CDW policies sold by the car rental companies will contain two important limitations, both of which could end up with you receiving some very large charges to your credit card.

The first of these is that the policy typically will exclude damage to certain areas of the rented vehicle. These are usually the wheels, tyres, windows, roof and undercarriage. These areas of a vehicle are all easily damaged and of course they can be expensive to repair.

The second problem comes about because of excess. The excess is a financial amount that the rental company’s insurance stipulates as the mandatory contribution you’ll have to make towards the cost of an accident. This figure is usually between 500 and 1500 pounds. If the damage repair cost is 1000 pounds and you have 500 pounds excess, you’ll need to pay 500 pounds of the claim. If the damage is 400 pounds then you’ll have to pay it all.

If you don’t like these conditions and risks you can purchase additional forms of CDW or top-up insurance from the car hire company. These may reduce the excess and cover the normally excluded areas of the vehicle. This form of insurance is very expensive though if purchased from a car rental company.

You may find it cheaper to purchase CDW cover and related car insurance products from a specialist hire car insurance provider. These companies sell their policies across the Internet and their pricing structure is usually far more attractive than that of the rental companies. They would, for example, be able to offer a policy that would reimburse you for any excess payments you’d had to make to the car rental company following an accident and it would also cover repair costs to areas of the vehicle excluded by the rental company’s CDW insurance.

As these CDW and related policies are sold by the direct insurers for a period of time (daily or annually) they can be used to cover any vehicle rented by you during the period providing certain conditions are met. It may be a good idea to pursue this one a little further if you’re interested in saving money.

Car rental insurance is a subject you should take seriously. Many people have an inclination to spend a lot of time looking for the model they want to hire and what extras to include but then move quickly over insurance without paying it too much attention. If you give into that temptation because insurance as a subject is boring, then you could be in line for some grief!

That’s because at the outset it is important to understand that if you have an accident in a hire car and the circumstances are not covered or not fully covered by insurance, then it will be you that is legally liable. You could be paying out some very large sums of money indeed should that happen.

Many renters think this is impossible because their car rental deal said “insurance included” or they purchased insurance from the car rental company. Unfortunately such insurance is limited and usually contains numerous exclusions.

It may offer cover for third party risks (damage to another person or their property) but in many countries the maximum amount payable may be capped at too low a level given the huge awards a court can make following an accident.

The rental company’s car rental insurance may also provide what’s called CDW (collision damage waiver) to cover against damage to the rented vehicle. Their basic cover though will usually exclude areas of the vehicle such as the tyres, wheels, undercarriage, roof and windows – all areas easily and expensively damaged.

Finally, their policy will almost certainly carry excess. The excess is a financial amount that the car rental company will expect you to pay towards the cost of an accident and it is typically set between 500 and 1500 pounds.

All told, you may find that you still have significant financial risk and exposure arising from your use of a rented car even when you have insurance in place.

There is a solution. You can purchase additional or ‘top-up’ insurance from the rental company. This may reduce excess, increase the amount of liability protection and cover areas of the vehicle normally excluded from damage provisions. The trouble is, this insurance is expensive when purchased from a rental company.

The direct insurance companies selling through the Internet usually provide a cheaper option for car rental insurance. They offer a range of products aimed at things such as car rental excess and liability cover etc. Their insurance is structured so that it is purchased for a number of days (or a year) and it will cover any vehicle rented by you during that period – subject to terms and conditions. This could not only save you a lot of money but it could also save time as you would not longer have to worry about this every time you rented a car. This could be very useful for any renter but particularly those that are planning to rent several times in a period. It may be worthwhile finding out more on this subject and their products and services can be checked out easily via the net.

If you have had ‘a bump’ in a rental car, you may not be too worried financially speaking. You may have purchased from the car rental company something called CDW (Collision Damage Waiver) that insured against damage to the rented car and therefore returned it without too much concern. It can therefore come as a nasty shock to subsequently see a large debit to your credit card from the rental company – and this can really happen unless you have car rental excess insurance.

So how can the insurance company charge you for the cost of an accident even though you had purchased insurance from them? This is explained by something called insurance excess. The excess is stipulated as a financial amount, usually between 500 and 1500 pounds that the insurance company will expect you to pay towards the cost of an accident.

They may call this the ‘first part’ of a claim because of how it works. If the policy carries a 750 pounds excess and you have an accident that causes 1000 pounds worth of damage, then you will have to pay the first 750 pounds of that 1000 as the ‘first part’ of the damage repair. If the damage was valued at 500 pounds, you would have to pay the full 500 pounds and the car rental company’s insurance would pay nothing.

This cost would usually be charged back directly to your credit card and it can prove controversial given that the renter usually has little control over who assesses the damage, who repairs it and at what cost.

Many people are understandably nervous about their excess and look for ways to reduce or eliminate it. There are usually two main ways of achieving that through something called car rental excess insurance.

The car rental company will be happy to sell you various forms of additional insurance, including this one. For an extra payment they will reduce the amount of excess payable, or in some cases, remove it entirely. Unfortunately you may find that their additional cover of this sort is expensive when compared to the other option.

There are direct insurance companies that sell car rental excess insurance through the Internet. These specialist suppliers are usually much cheaper than the car rental companies. Their policies operate by reimbursing you for any excess charge that the car rental company debit to your card.

As this type of policy also applies to you the renter rather than a specific car rental agreement, they also have the advantage of being purchasable for a period of days or even a year. What this means is that any vehicle rented by you during that period, providing the terms and conditions were met, would be automatically covered. This offers considerable benefit not only in terms of being able to purchase cheaper car rental excess insurance but also in terms of flexibility as no longer would you need to debate insurance options every time you arrived to collect your rented car.

The importance of car rental excess insurance should never be underestimated and is something that should be considered by anyone who rents a car.

Many people hiring a car automatically take the car rental cover offered by the car rental company. This could be because many rentals these days are sold with insurance included in the price, simply out of convenience or because that’s how they’ve always done it.

So even if they’ve shopped around to find the best car rental deal available, some people may spend more on insurance than is necessary simply due to convenience or habit. What’s worse is that some people may not even realise that when it comes to car rental cover there is an alternative to the car rental company’s insurance.

If your rental agreement has insurance included the level of cover that it offers may fall far short of leaving you fully insured. Many Collision Damage Waiver policies that come as standard actually carry large excess clauses. The excess is the amount you could be liable to pay if the rental car is damaged and needs to be repaired and can be as much as 1500 pounds. Obviously if the cost of the damage is less than the excess you only pay the actual cost.

Either way though the costs involved could be substantial especially if you bear in mind that you have no control over where or by whom the repairs are carried out. The rental companies are unlikely to shop around to find the cheapest garage to do the repairs.

In addition to the excess, a number of key elements of the car will also be excluded completely from the cover and any damage to these areas, the windscreen, tyres, undercarriage and roof will have to be paid for by you.

The car rental company will be more than happy to sell you additional top-up insurance at a daily rate to reduce your Excess liability. For a very short rental of a day or so, this may not seem like a lot of money but for longer rentals it can all mount up to a substantial sum.

It may make financial sense to shop around for car rental cover and you may be surprised at the savings, which could result. Even if you have a rental deal, which includes insurance, and are only looking for top-up cover for excesses, you can still buy this from one of the independent specialists in car rental cover. These companies can provide as little or as much cover as you want.

The policies that they sell are not just based on a daily rate for the duration of the rental. They also sell annual policies so you can you use the same policy for a number of car rentals in the course of a year and you are not tied in any way to a particular car rental company. These annual car rental cover policies may not to be available for specialist vehicles such as vintage or sports models, or those of very high value. However, provided you are looking for something a bit more ‘ordinary’ then an annual policy could make sense for you particularly if you have plans to rent a car on a number of occasions over the course of a year.

These days hiring a car is relatively easy. Many of the bigger companies offer facilities on the Internet and try to make things as simple and straight forward as possible. Some of these even offer attractively priced deals, which include car hire insurance.

If you are tempted by these offers it may be sensible to carefully check out just what level of insurance cover is included in the price. The consequences of being underinsured in the event of an accident can be serious.

At first glance car hire insurance can seem to be a complicated business. Terms like CDW, LDW, SLI and Super CDW are all bandied about but what exactly do they mean and how much insurance do you actually need?

When you drive your own car, you need to be covered for damage to your car and you need to be covered for damage to someone else’s person or property. When you hire a car your car hire insurance needs to give you the same basic cover.

Collision Damage Waiver CDW also known as Loss Damage Waiver (LDW) provides cover for damage to or theft/loss of the hire car.

Many CDW policies carry excesses and exclusions, which limit the amount of cover that they provide. Excess amounts can range from 500 to as much as 1500 pounds. This means that if the hire car suffers 1000 pounds of damage and there is an excess of 750 pounds, then you would have to pay for the first 750 pounds. Your CDW policy would cover only the remaining 250 pounds.

Most CDW policies will also specifically exclude from cover damage to certain areas of the car. These exclusions are typically the most easily damaged parts of the car like the windscreen, tyres, roof and undercarriage.

It is possible to buy top up insurance to reduce excess liability and increase levels of cover. This is commonly known as excess insurance or excess Waiver insurance

Third Party Insurance provides cover for damage to someone else or to their car. By law all cars rented in the UK must have unlimited liability third party insurance so the policy will have no upper limit for any damages awarded against you. This is not the case elsewhere in the world and particularly in the USA where third party insurance can even be optional. In these countries you may want to think about topping up the third party cover offered and this type of policy is known as Supplemental Liability Insurance or SLI. Super CDW is also a term used to describe this facility.

It may be tempting to buy additional or top-up car hire insurance from the car hire company either when you make the booking or when you pick up the keys of the vehicle. This may not be the best solution however either in terms of price or in terms of the cover provided. Specialist insurance companies easily found on the Internet can offer much more attractive deals for car hire insurance and their excess top-up policies can cover those items generally excluded from other policies by the car rental companies.

When you hire a car your Collision Damage Waiver or CDW will generally include excess, which you can avoid by buying an additional car hire excess waiver policy.

The excess on the CDW is the maximum amount that you would be liable to pay in the event of damage to the vehicle. If the cost of the damage is less than the excess you pay the actual costs. If it is more than the excess, you pay the excess amount. With excesses typically between 500-1500 pounds, this can amount to a hefty charge if the rental car is damaged.

You can take out additional insurance to remove or at least reduce the amount of excess payable. This is known as car hire excess waiver. You may also see it described as Super CDW. When you buy this type of cover you ‘waive’ your responsibility for paying the excess and the insurer takes on this responsibility.

You’ll probably find when you pick up the hire car keys that the hire company will try to sell you excess insurance. You’ll also probably find that the daily rate they quote you can significantly increase the total cost of your rental.

Given that you may have searched high and low to get the best possible rental deal, you may be interested to know that you can do the same for car hire excess insurance. Even if your rental agreement includes CDW insurance, you do not have to buy any excess or top-up insurance from the car rental company. You can look elsewhere for a better deal.

There are independent insurance companies who are specialist in this field and who can offer car hire excess waiver policies on a daily or an annual basis. You may find that these policies are significantly cheaper than those on offer from the car hire companies.

They may also provide cover for damage to those areas of the car normally excluded by most CDW policies. Areas like the windscreen and tyres are easily damaged and are therefore excluded from most policies including top-ups. The car hire excess waiver provided by independent insurers may include these areas as standard and so provide a wider level of cover than a similar policy bought from the car rental company.

You may also find the idea of an annual policy interesting. As the policy belongs to you, you can use it again and again in the course of the year for any number of rentals provided that the cars you hire are within the agreed conditions of the policy. This may mean that certain types of vehicle are excluded for example vintage or sports cars or those with a very high value.

The independent insurance companies can provide car hire excess waiver policies for your car hire needs in the UK, Europe, the USA as well as other destinations worldwide. The car rental company will charge any excess costs to your credit card and you would then simply have to claim on your waiver to be reimbursed by you insurance company. These are options that may be worth checking out further.

Many companies that are trying to sell something will try to make their headline price look at low as possible. One of the techniques some car rental companies use to achieve this is to offer a rental price that ‘includes insurance’ but not to make clear that this insurance also carries car hire excess.

What this means is that if you have an accident, you could still be facing significant costs even though you have insurance in place. This can best be illustrated with an example.

The car rental companies will usually offer insurance against third party liability, theft and CDW (collision damage waiver). CDW is the insurance that covers any accidents that result in damage to the rental car. These insurance types may be included in the rental price as is commonly the case in many European countries, or the car rental company may offer them as separate purchases as is more commonly the case in the USA.

If you hire a car that has its basic forms of insurance provided by the car rental company, then there’s a good chance to the policy will also carry something called ‘excess’ as mentioned above. The ‘excess’ on a policy is the amount of money that the car rental company will insist you pay towards the ‘first part’ of any insurance claim.

The car hire excess is usually set between 500 and 1500 pounds and works simply. If you have 750 pounds excess and an accident results in damage to the rented car of 1500 pounds, the car rental company will charge the 750 pounds to your credit card as your contribution. If the damage totals only say 400 pounds, this is the amount that will be debited to your card.

Although excess is a normal insurance technique, it has proven controversial in the past with car rentals. That’s because if the car is damaged, the renter has little control over who repairs the car and at what cost. That can prove a nasty shock when the charge hits your credit.

If you’d like to protect yourself against car hire excess then the good news is that you can do so. The car rental company will offer to sell you ‘top-up’ insurance that for an extra cost will eliminate the excess from the policy (or reduce it). Unfortunately this insurance can prove to be expensive if purchased from a car rental company.

The direct insurance companies that sell over the Internet offer a more affordable option. They will sell car hire excess insurance that mean should the rental company charge excess to your credit card, the amount concerned can be claimed back from them. These policies also offer numerous other advantages such as policies that are sold on a daily or annual basis. These policies will cover any rental car driven by the policyholder during the lifetime of the policy (subject to terms and conditions). The cost savings and increased flexibility here can be substantial – particularly for those that rent regularly. It may be worth considering.