Excess waiver insurance is a type of insurance that applies to rental cars and it could save you money. How?
The excess on rental car insurance
For many people renting cars, the words on the car hire company’s site that say “insurance included” are a source of comfort. Yet this may not be the end of the story.
There are two common forms of rental car insurance:
- third party liability – this provides a financial shield against costs awarded against you following a claim from a third party relating to injury or property damage you may have caused them with the rented vehicle;
- CDW (collision damage waiver) that does the same thing but for any costs you may incur due to damage to (or the theft of) the rental car.
The policy may however carry what’s called an ‘excess’.
The excess is defined as an amount of money, typically between £500-£1600, that the rental company may debit to your credit card following an accident.
It works like this, using an example of an £800 excess. If you have an accident that leads to £1000 worth of damage, you may find £800 pounds of that charged to your credit card and the rental company’s insurance would pay the balance of only £200. Had the damage cost £750 you would have paid it all.
Excess waiver insurance
It would be understandable if you were a little concerned about this. Following an accident you may have little or no control over who assesses the damage to the hire car or who repairs it and for what cost.
You can protect yourself from the risks of an excess charge by taking out excess waiver insurance. This typically comes in two forms:
- purchased from the rental company (who may call it ‘top-up insurance’ or possibly ‘Super-CDW’);
- purchased from an online provider of specialist car rental insurance.
In the case of the former, the rental company’s excess waiver insurance means that they may agree to reduce or perhaps even remove entirely, the excess from their policy.
The specialist providers of excess waiver cover operate by offering you a policy that you can use to reclaim any excess charges you’ve been billed by the rental company. Typically these forms of policy will be cheaper than the cover offered by the car rental companies.
You may also find that the policies of the specialist providers bring added benefits.
Typically the basic CDW insurance provided by a rental company will exclude a number of important areas of the car from its base protection. These may vary but typically include the wheels, tyres, roof, windows and undercarriage. Any damage to those could also result in a charge to your credit card.
The policies sold by the specialist providers may also cover you against these charges. Not only that but they can be purchased on an annual basis. This means that if you rent regularly you could use the one policy for all your excess waiver insurance needs during the lifetime of the policy (subject to terms and conditions). So it could save you even more money!
Tags: Excess Waiver Insurance