Having a bump in a rental car can happen to anyone. In such circumstances what some renters then find is that their credit card has been billed a large amount by the car rental company for repairs. If you’d like to avoid this situation happening to you, it may be advisable to consider something called collision damage waiver cover.
This is a form of insurance that applies to rented cars and basically protects you against the costs of repairs to the rented vehicle if it is damaged while in your care. It may come included in the rental price or it may be an optional extra that the car rental company will advise you to purchase. It is important to remember that if you decline the collision damage waiver cover (sometimes called CDW) then you will personally have to pay for all repairs to the vehicle following an accident.
There are two other things that you should take note of in this area. Firstly, the basic Collision damage waiver cover sold (or provided in the price) by the car rental company is very likely to be limited in terms of what it covers. It will typically exclude damage to areas of the car such as the wheels, tyres, roof, undercarriage and windows. These areas of a vehicle can be easily damaged even in trivial accidents and they can be expensive to repair. If they are excluded, you’ll have to pay.
Secondly, the policy will probably carry excess. The excess is an amount of money that the car rental company will expect you to pay towards the cost of any repair bills even if you have collision damage waiver cover in place. This figure is often between 500-1500 pounds. So if you have excess of 1000 pounds on the policy and the repair costs are 1500 pounds then you will need to pay 1000 pounds towards the costs. If the repair costs are 750 pounds you will have to pay it all.
You can avoid some of the risks here by purchasing additional insurance (sometimes called top-up) that can reduce the excess and extend cover to include areas of the vehicle normally excluded.
The car rental company may offer top-up insurance but in general their insurance will be significantly more expensive that the same policies purchased from a specialist insurance company online. These companies offer collision damage waiver cover that will reimburse your costs should you have to pay the car rental company excess or form damage to parts of the car excluded by the car rental company’s own basic policies.
Purchasing collision damage waiver cover from a direct insurer may not only save you money but it could offer significant additional flexibility. That arises from the fact that these companies sell their policies to a policyholder and they can be purchased on a daily or annual basis. What this means is that the policy will cover any vehicle rented by the policyholder during the life of the policy (subject to their conditions). This could save significant amounts of time cost and administration – particularly for those renting regularly.