Having a minor driving accident is always traumatic. It can be even more so if you are driving a rented vehicle that suffers damage because you can find yourself facing a very large repair bill. You are going to have to pay this unless you have taken out something called damage liability waiver.
When you rented the car to begin with, it may have had something included in the price called damage liability waiver (more commonly called collision damage waiver or CDW). If it didn’t, you will probably have been invited to purchase CDW by the car rental company.
Damage liability waiver or CDW, is essentially a form of insurance that looks to protect a car renter against the high costs of repair they will have to pay if they have sustained even minor damage to the rented vehicle. If CDW in place, the damage would be paid for in part by the car rental company’s insurance policy.
The basic form of CDW sold by the car rental companies, or included in the rental price, is useful but it can still leave a renter facing large bills after an accident. That is because the basic CDW sold by car rental companies often excludes cover for areas of the vehicle such as wheels, tyres, roof and windows. These are all parts of a car that are easily and expensively damaged.
Most CDW policies from the car hire companies will also carry excess. The excess is the first financial part of any claim that the renter will be expected to pay out of his or her own pocket – in other words it is a form of ‘contribution’ towards the repair costs. The excess amount on the policy varies widely, but a figure somewhere between 500 – 1500 pounds would be commonplace.
If you are concerned about the risks and possible bills involved, it is possible to offset these by paying a little extra.
Most car rental companies will be very keen to sell you additional ‘top up’ insurance to increase the cover on things such as damage liability waiver. These additional policies can reduce the excess payable and possibly include insurance cover to areas such as the tyres etc. Although sometimes convenient, taking out this type of cover through a rental company can be very expensive.
The online direct insurance companies and brokers offer an alternative option. These offer various forms of car rental insurance and their policies are very different to those of the rental companies because they cover a policyholder and not the hire of an individual car. As they typically are sold for a period of days or even a year, they will cover any vehicles rented during that period and their cover is often broader based and superior to that offered by the car rental companies.
The damage liability waiver cover offered by these companies is frequently considerably cheaper that that purchased from a car hire company. If you are unfortunate to need to pay the car rental company the excess following an accident, then the insurance company will reimburse you through this ‘top up insurance’. This could be a way of saving a lot of money!
Tags: Damage Liability Waiver