Car rental hire insurance is an important subject wherever you rent rarely or repeatedly. You have the option to save yourself a lot of money and reduce your risks by taking a just a few minutes to shop around. How does this work?
When renting a car you will probably want to ensure that you are covered against the risk of injuring other parties or damage you may cause to their property. This form of insurance is usually called third-party liability and it is important to get it right. In the unhappy event of an accident, court awards to injured parties may be very high. Much of the third-party insurance provided by car rental companies will be capped to a maximum payout level that is far below the potential award levels of the courts (apart from in the UK where this insurance must by law be unlimited). Remember that if a court award exceeds the financial limit of your insurance, it is you who will need to pay the difference!
The other major form of cover is called CDW (Collision Damage Waiver). This covers the costs of damage to the rented car itself following an accident. Once again, the standard CDW provided by the car rental company may be limited. It very probably will exclude damage to several areas of the rented vehicle such as the wheels, tires, roof, windows and undercarriage. These are all both easily AND expensively damaged even in a minor accident and if they are excluded, once again it is you who will have to pay.
Finally, the car rental hire insurance provided by the rental company will very likely contain large excess. The excess is an amount of money (usually 500-1500 pounds) that the rental company will charge to your credit card as a mandatory contribution to the 'first part' of any accident costs. If you have 1000 pounds excess and the accident cost is 1500 pounds, you will receive a charge to your credit card of 1000 pounds. If the claim cost were only 500 then you would have to pay it all.
Given these limitations and exposures, many renters look for ways to increase their insurance coverage and protection and turn to the car rental company for help. The rental company will offer additional 'top-up' car rental hire insurance. This may increase the amount of third-party cover, extend cover to normally excluded areas of the vehicle and possibly reduce or remove the excess. The bad news is that this additional cover is expensive – usually several times more expensive than the car rental hire insurance products sold over the Internet by the specialist insurance providers.
Where to get a good deal
These providers sell a variety of insurance products that can help cover the above shortcomings in the rental company's policy and at an economic price. They can provide additional liability cover and insure you against charges from the rental company for damage to 'excluded' areas of the vehicle or excess. You may still have to pay the rental company but could then claim this back from your direct policy.
So if you're looking for additional options for car rental hire insurance and to save money, the specialist insurance providers may be worth a look.