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Last updated: 21/04/2021

Car hire excess insurance: what cover do you need for a rental car?

When you're renting a car, at home or abroad, there's often a lot of paperwork to deal with, and hidden fees tucked away in the small print that you'll want to be careful to avoid. In and amongst all this, it can be easy to forget about insurance. What cover do you need to take out on a rental? And what comes included? We'll go over everything you need to know in this guide.

In This Guide:

Is insurance included for hire cars?

When hiring a car, all rental companies should provide you with third party cover as standard. You'll then usually have the option of purchasing extras like breakdown cover if you want it.

Collision damage waiver and loss damage waiver

Usually, you'll also have a damage waiver - either collision (CDW) or loss (LDW) - included, and this functions similarly to standard insurance in that you're covered for damage to the vehicle itself. The damage waiver is usually limited to certain types of damage, however (it might not cover damage to tyres, for example), and any claims will be subject to excess.

What is car hire excess insurance?

Any cover you do get with your rental agreement will usually be subject to an ‘excess’. This means that you have to pay a contribution towards the repair of the vehicle, no matter who is at fault. This can be as high as £2,000, so it is essential to understand what you are liable for before you take out a policy.

Car hire excess insurance will cover you for that excess, as well as for any additional types of damage to the vehicle that the basic policy doesn't. This can include things like damage to tyres or windscreen. Car hire excess insurance is in some ways closer to travel insurance than to car insurance, since you can buy it to cover the period during which you've got your rental, or as an annual policy, which can be a good idea if you rent cars frequently throughout the year. 

Do I need car hire excess insurance?

As with most types of insurance, you don’t have to get it if you don’t want to. But with car hire excess insurance, you can pay a small fee to avoid paying a larger one. Often, with the basic insurance provided, you won’t be covered for things such as broken windscreens or tyres, which can easily be damaged.

How do I find the best deal on my car rental and car insurance?

Renting a vehicle, and the car insurance that comes with it, is like any other purchase - the more research you do the better. There are a few key tips when it comes to renting that you should bear in mind:

  • Avoid renting at the airport: When renting directly at the airport, they know that they are your only option, and are often encouraged to put on as many extra fees as possible
  • Search the internet: do not take the initial price you have been quoted as the final one. There are always coupons and codes available online that can make it cheaper.
  • Prepaid rental: Although much cheaper, they are inflexible and will not allow you to change if your plans change so you could lose out on money if you pay too early

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