Andrew leads our Operational Team and is our expert when it comes to all the ins and outs of car hire excess insurance.
Hiring a car is a great way to make the most of your holiday, and in the vast majority of cases car hirers find the booking, picking up and returning of their car to be a problem free experience. However there are also occasions when things don't go as smoothly – so how can you improve your chances of making sure you do not face issues before, during or after your break?
In the first of three articles on the subject we concentrate on the car hire booking process, and how to navigate your way through the mysterious terminology and hidden charges and get a great deal on car hire.
Rates go up and down according to supply and demand but the best deals tend to be achieved by booking early. To make sure you win whatever prices do in the future consider booking through a company who offers free cancellation – then you switch if a better deal comes along.
It's not all about the headline rate. On comparison websites a few pounds can make the difference between a car being seen and selected and not. This has encouraged strong competition but also means car hire companies try to quote the lowest figure possible and claw it back by other means.
A common tactic used to increase returns on European destinations are "full to empty” fuel policies. You have to pay for a full tank of fuel on pick up, normally at more than pump price and return it empty "giving” the rental firm any fuel left in the tank.
Avoid this trap by choosing a car with a fairer fuel policy where, so long the car is returned with the same amount of fuel as it was supplied it with, you won't be charged for unused fuel.
In some areas of Spain and France this practice is widespread meaning selecting fair fuel cars only restricts your choice too much. You may find the difference in price between cars running a fair fuel policy and those that don't is so great that you might as well accept you will lose money on the fuel as you will still be better off overall.
Our ‘Fairer Fuel' filter will, in affected areas, compare fuel policies fast allowing you to make an informed choice.
Another area where there are big differences in charges between suppliers and sometimes even for the same car via different brokers is for additional drivers.
Our ‘Free Additional Driver' filter allows you to see the cars which include the first additional driver without charge.
Expect younger drivers, normally 21-25 year olds but under 30′s on some cars, to attract a surcharge both as main driver and additional and these surcharges can be steep – up to £12-£15 per day. But there is variation both in the charges and the age ranges to which the surcharges apply.
There are a small number of companies which insist that drivers over or under specific ages must purchase their excess protection policy so factor this into the total price.
Once you've found the right combination of Car, Fuel Policy, Additional Drivers and are happy with your cancellation options you can book the car. At this point you will probably be offered excess waivers or excess waivers including tyre and window cover. These fall into one of two camps: waivers and reimbursement insurance.
Waivers are typically provided by the car hire company itself. They are not insurance products so if they make a ruling that your accident was not covered your only recourse would be the courts in their country. Car hire company waivers do have the advantage that the car hire company may not insist on as big a pre-authorisation on your credit card as they otherwise would, and mean the car rental firm will not bill you for damage covered by the waiver they offer.
The downside is that these policies often cover less than independently bought excess insurance, excluding damage and related claimed for windscreen, tyres, wheels and the car's underbody. They also tend to be about 5 to 10 times the cost.
These policies can be bought through a car hire broker (normally for £5- £7 per day) or directly from the insurers using the MoneyMaxim car hire excess insurance comparison service for just £2 – £4 a day. MoneyMaxim also offer annual policies from under £40 p.a.
For European hires, cars normally come with a Collision Damage Waiver and Theft Waiver with an excess to pay should your car be damaged or stolen. The damage waiver normally exclude damage to wheels, tyres, windscreen, roof, interior or underside of the car.
Be aware that Zero Excess waivers offered by brokers may still leave you with responsibility for these parts of the car or refuse to cover certain types or damage such as scratches sustained in a car park.
Read carefully any car hire documentation to see if other exclusions to Collision Damage Waivers are relevant to you. For example CDW cover can be withdrawn if you take the car on a ferry meaning that while it's on board you are responsible for the full value of the car.
Another CDW exclusion that would cause more widespread concern is appearing in Italy at the moment. Locauto in Sicily provide no cover if you are involved in a single vehicle accident meaning you could face a huge bill if you swerve to avoid a dog in the road and hit a tree or wall..
Fortunately even in these cases MoneyMaxim can help. Get a quote for a Worldwide car hire excess policy which offers higher levels of cover including full CDW worldwide. Selected policies from Worldwide Insure, Questor, ProtectYourBubble and Travelexcess offer £50,000 of CDW that will apply in Europe as well as American destinations.. If you are in doubt please call our customer service team.
For most (but not all) rentals though a UK site like ours you will find Collision Damage and Theft Waivers included in the price. They often have a zero excess (or deductible) too leaving just the vulnerable wheels/tyres/windscreen/underside areas needing cover.
However, as the locals would normally switch their standard car insurance over to rental vehicles it is possible for cars to be hired without these waivers. In this case purchase a full CDW insurance policy to avoid paying much more at the desk.
Americans don't like being told how much third party insurance they should have and as a result, the levels of cover can be minimal. They vary from state to state but it is legal to drive a hire car in Florida with insurance that would cover just $10,000 of bodily injury cover per person ($20,000 for all people) and $10,000 for property damage.
Most rentals booked through our site will include what is termed supplementary liability insurance (SLI) to increase the third party insurance cover to a more satisfactory level.
If you find that you do not have this pretty much essential cover you can buy SLI through the MoneyMaxim car hire insurance service.
Many destinations (eg. Australia, New Zealand, South Africa) will normally include CDW and decent third party insurance but always check what is included. Many excess insurance policies for worldwide use come with greater levels of cover than European ones albeit at slightly higher costs. If you do need CDW or SLI cover (see USA section above), then check that the policy offers this enhance level cover worldwide as some are restricted to the Americas.
Once you've chosen your car and booked it, you will be sent a rental voucher from the broker, usually by email. Don't just file it so you can print it out closer to the hire start date. Read it! Check that you understand the any terms and conditions and if there are any you don't understand – phone up or email to check. If you don't like what you find, you will have more rights to cancel the booking in the first 48 hours than after.
Though it is sometimes possible to hire cars using a debit card we don't advise doing so as it severely limits your choice and you may find that you are then obliged to purchase their excess protection policy at great expense.
Most car hire companies insist on credit cards. Check the terms and conditions. It is quite common for the rental company to require the same card that was used for the booking (partly as proof of identity). Some companies will require more than one credit card.
The rental company will normally take a pre-authorisation of an amount in case of damage to the car, unpaid parking fines or tolls. The amount varies but it makes sense to have enough credit remaining on the card to allow a pre-authorisation of the amount of the excess on the car and more if you actually want to be able to use the card afterwards. If you don't have enough room on your credit card to allow for this pre-authorisation, some car hire company may insist that you take their expensive waiver options.
Another reason for avoiding debit cards is that they do not allow ‘pre-authorisations'. Instead you may find that the deposit have been debited from your card and will be held by the car rental firm. Worse still they insist that they have your card in their possession when your return your card to recredit you. If you are not able to do this as you are returning the car in dead of the night you can face a real challenge in getting your money back. You will also find that in most cases you will get back slightly less than you paid as a deposit as most banks have a different rate for debits and credits to your account.
The moral of the tale – use a credit card – and if you haven't got one consider one of those recommended in our separate article: Good Credit Cards to use Abroad
Next: picking up your car