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Mark Bower

Mark founded MoneyMaxim in 2008, with the aim of delivering an impartial and independent service. Mark is a regular money saving expert in the press and writes regular news and articles for the MoneyMaxim news pages sharing his views on banking, personal insurance and the utilities (gas, electricity, mobile and home phones, broadband and pay TV) market with customers.

Confusion as Car Hire Firms amend Cancellation Policies

Need to cancel your car hire? Customer expectations are challenged as some car hire brokers normal refund policies change overnight.

Car hire Cancellation

For many of us, up until recently, cancelling a car hire booking has been pretty straight forward. As long as a couple of days notice has been given then most car hire brokers would allow reservations to be cancelled either free, or on payment of a nominal fee, and any balancing payment would be back in your account in days.

As a result we are suggesting that if you are looking to make a booking for a future date you should:

  • look for a deal where you do not have to pay up front in full meaning you only pay a fraction of the car hire charge until you collect your car
  • book with a company offering free cancellation
  • use companies who you feel confident will do what they have promised if you do need to cancel.

It is without doubt that a number of car hire brokers and companies have found the last few weeks difficult - but some much more so than others.

The model many car hire brokers adopt mean they are susceptible to difficulties if conditions change rapidly. Those brokers who ask for full payment on reservation effectively hold that cash (or should do so) until they are billed by the car hire firm after you have collected the vehicle. Unlike the package holiday business there is no requirement for ATOL or ABTA bonding, or need to ring fence the amounts they are holding in case something goes wrong - which means that often the prepayments end up being used to fund the businesses cashflow requirements - and that is where the problems start.

Over the years there have been a number of companies who have ended up going out of business and leaving hirers high and dry - including AtlasChoice in 2017 and VehicleRent earlier this year.

So to help you make an informed choice as to which car hire broker you might want to use when you next hire a vehicle (whether in the UK or further afield) we have summarised below the current position of many of the UKs leading brokers.

Holiday Autos and Argus Car Hire - both owned by the industry giant Car Trawler whose owners are currently looking at a emergency financial restructuring as a result of coronavirus. They are currently delaying paying refunds due to customers, saying that they expect these to be paid at the end of May. The majority of rentals are made on a prepaid basis.

Auto Europe - Have introduced a £20 'processing fee' for cancellations due to the higher volume caused by Covid-19. This applies both to new and existing bookings. Again most bookings are prepaid.

Enjoy Car Hire - Only charge a small deposit for most bookings, which until recently was non refundable unless an additional fee was paid. They are now offering a free cancellation for new bookings.

Clarify Car Hire - A small deposit was taken for all bookings which was non refundable, but in these cases vouchers have been issued to compensate customers if the cancellation was due to Covid-19. Still only taking a small deposit but also now offering free cancellation to any MoneyMaxim visitors who use the voucher code FREECANC when booking (valid on reservations made before 30th June 2020).

Rentalcars.com - Most bookings are on a prepaid basis and made on a free cancellation basis. This has continued throughout the recent weeks.

Zest Car Hire - Most bookings are on a prepaid basis. Previously a £15 fee applied for all cancelled bookings. For new bookings made before the 1st June free cancellation insurance is included.

Prices from all the companies above can be obtained using the MoneyMaxim Car Hire Comparison service.

Image courtesy of: Nick Youngson