It has to be admitted that ‘Car Hire Excess Waiver’ is a grim-sounding phrase that’s not likely to immediately ring a bell in most people’s minds. It is in fact a technical term used to describe an aspect of rental car insurance.
If the thought of reading about insurance has you reaching for the ‘NEXT’ button, you may want to pause. Car hire insurance can be expensive and you have ways of saving yourself a lot of money – so it may be worth reading on!
When you hire a car, the position with regards to what insurance is or is not included in the rental price will vary considerably. In some countries such as the UK, it is now fairly common to see some forms of basic insurance included in the rental price. In fact, by UK law, a hire car must come with at least unlimited third-party liability included (this is the form of insurance to cover claims from other people that you have injured them or their property with the rented car).
Covering rented cars
In the UK and many other European countries, if renting from a major rental company, the basic rental price may also include something called CDW (Collision Damage Waiver). This insurance covers damage done to the rented car.
In other countries, such as the USA, the basic rental price may include little if any insurance and the renter will need to purchase it separately from the rental company or from a specialist insurance provider – it’s worth remembering that the renter is not obliged to buy such insurance from the car rental company. In fact, the insurance sold by the car rental company will usually be several times more expensive than similar insurance purchased over the Internet from a direct provider.
If you have purchased or had ‘included in the price’ insurance from the rental company, you may find that the policy is subject to excess. The excess is what the rental company will call a mandatory contribution that you would have to make towards the cost of an accident. It is usually set somewhere between 500 and 1500 pounds. What this means is that if it is set to say 750 pounds and you subsequently have an accident resulting in 1500 pounds’ worth of damage, the rental company would debit your credit card for 750 pounds of it as ‘the excess’. If the damage cost were 400 pounds with 750 pounds excess, you would have to pay the entire 400 pounds.
Top-up cover
If you don’t like the thought of this sort of risk, you can eliminate it with car hire excess waiver insurance. You can deal with this through the rental company. By paying them an additional amount of money they will reduce or eliminate (i.e. waive) the excess. Strictly speaking, car hire excess waiver purchased like this is not really insurance although the rental company may call it ‘top-up’ insurance. It is also likely to be very expensive and there are much cheaper ways of dealing with the excess. Continue reading »