You’re taking a very big risk indeed If you drive a rented car without car hire cover insurance.
In most countries of the world, driving a motor vehicle on a public road without certain minimums of insurance is a criminal offence. Not only that, but if you have an accident in a hire car and you are not insured, then you’ll have to pay for all the costs involved.
In fact, in most countries of the world the rented car will come with some forms of basic insurance already included in the price. In others, with the USA being the best example, the basic rental cost may include little if any insurance – all of which is available as an optional extra.
Wherever you are renting, and whatever rental company you are using, you should keep in mind that to reduce your risk of financial catastrophe it is necessary to consider three basic types of rental car insurance.
The first of these is third party or third party liability insurance. This is a form of car hire cover that will meet the costs of any third parties that have been injured or who have had their property damaged, by you in an accident. Although not a problem in the UK where the amount of cover must be unlimited by law, in most other countries you should check to ensure that the maximum amount payable is not capped by the rental company at an unrealistically low level.
The second form of car hire cover comes with theft insurance. This means you will be covered should the rental car be stolen while you’re renting it.
Finally, there is collision damage waiver (or CDW). This is a form of car hire cover that protects the rented vehicle, and your pocket, from damage caused during an accident. Once again, it is usually advisable to check this carefully as it will very probably exclude damage to certain areas of the rented car and in addition carry excess. The excess is that amount of money you will need to pay as ‘the first part’ of the cost of any claim. This excess is usually set at between 500 and 1500 pounds – a lot of money you may have to pay out given you have insurance.
Once you have reviewed the insurance position, you may feel that you would like to protect yourself further by increasing the level of liability cover, removing the exclusions relating to specific areas of the vehicle, reducing the excess payable or perhaps all three
You can do this in one of two ways. The car rental company will offer you additional car hire cover insurance. They may call this ‘top-up’ insurance and it may reduce the excess payable, increase liability cover and possibly cover normally excluded areas of the vehicle.
You may find though that this is expensive – typically much more so than purchasing the same insurance from a direct insurance company online. The specialist insurers will sell insurance that can cover all these risks for you and their prices are usually significantly cheaper than those of the rental companies.
Another major advantage of car hire cover insurance taken out through a direct insurance company is that it can be purchased on a daily or annual basis rather than being linked to a specific car rental. This means that for the lifetime of the policy, the renter will be covered for any vehicle rented (though this may exclude certain specialist vehicles such as sports cars or those with a value in excess of 100,000 pounds). So not only could this option save money but it may also be far more flexible. It may be worth investigating further.
Tags: car hire cover insurance