Insurance is typically given when you rent a car, however it is only the minimum that is legally required. This level of rental car insurance cover may still leave you at risk financially and you may feel that additional cover could be beneficial.
There are typically two main components of rental car insurance.
- The first is Third Party cover. This provides protection for you against claims for damages from other people (the third party) who may have been injured or whose property may have been damage by you while you were driving the rental car.
In the UK this cover will typically give you unlimited cover which means that no matter the size of any financial award against you, your third party insurance would cover it completely.
In other countries this might usually not be the case and you may find that you are personally liable for any shortfall between your insurance cover and the amount that a court could award for damages. Supplementary Liability Insurance (SLI) is a form of top-up for Third Party cover, which increases the amount of cover to be more in line with potential court awards.
- The second benefit of rental car insurance is Collision or Loss Damage Waiver. (CDW or LDW). This is the insurance for the hire car itself in the event that it is damaged, stolen or lost while on hire to you. A basic CDW policy will typically carry an excess and it will usually also exclude certain parts of the car from insurance.
Excess is the amount of money that you have to find out of your own pocket if a claim were to arise. Typical excess levels for these rentals may generally be between £500 and £1600. If you are hiring a rental car in the USA check your rental agreement as you may find there is no insurance at all and as such the cost to you in the event of damage to the car might be considerable higher than in the UK.
The excluded parts are generally the windows including the windscreen, the tyres and the under body of the car. If these are damaged you might have to pay for the repairs.
It is possible to buy top up cover for your rental car insurance to remove or at least reduce the excess amounts you could be expected to contribute to a claim. This is generally known as excess cover, or Super CDW.
However while this protection may save you from considerable expense in the event of a claim, it typically adds onto the cost of your rental. If you are prepared to look elsewhere at some of the products on offer from car hire specialists on the Internet, then you may find that there are very much cheaper ways of giving yourself the level of insurance cover that you feel comfortable with.
You may also get a more attractive deal with additional benefits when taking insurance with a specialist insurance provider. These generally include the replacement of lost or stolen keys, stolen baggage cover and automatic inclusion of those ‘excluded’ parts.
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