Car Rental Insurance When Travelling Abroad: Do You Need One?
When renting a car, you should look at what is included in the basic insurance to decide whether to buy an additional package, for example, worldwide car hire excess insurance.
Renting a car is one of the best options for traveling in some countries. It opens up many advantages for tourists.
You can rent accommodation on the outskirts of the city, where it is usually cheaper. It will make it easier to plan arrival and departure from the country. It is not a rare case that you arrive at one airport and leave from another. Rental companies usually allow you to pick up a car in one place and leave it in a different one. And the main benefit is, of course, mobility.
But do not forget about some such important nuance as a car rental insurance policy. In most cases, rental cost includes basic insurance. However, its coverage can have significant differences. Therefore, when renting a car, you should look at what is included in the basic insurance to decide whether to buy an additional package, for example, worldwide car hire excess insurance.
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Types of car rental insurance
As a rule, rental companies use one of the following types of insurance:
CDW (Collision Damage Waiver). It protects from the risks of damage to the car. But it does not cover the risk of theft.
LDW (Loss Damage Waiver). It is a basic insurance option that is often included in the rental price. LDW covers costs in case of accident or theft. It usually applies to all people allowed to drive a car under a lease agreement.
TLP (Third Liability Protection) or TPL (Third Party Liability). These can also be included in the base rental price. They are valid in case of damage, in particular in case of injuries to passengers and damage to their property.
SCDW (Super Collision Damage Waiver). According to this insurance, the company covers the costs after the accident. But SCDW does not include such cases as car theft, damage to the interior, wheels, glass and other parts of the car. Its advantage is that you don’t need a deposit at all when renting a car or need to pay a really symbolic price below € 100. But there is also a minus here – get ready for a surcharge of approximately €10 or more per day, depending on the car.
Car Hire Excess Insurance. With this type of insurance, your liability for damages is reduced to zero. It is insurance without a deposit and deductible. If the car is damaged during the rental period, the algorithm of actions is as follows:
- You pay the deductible.
- Then you collect documents about the accident, including a report of the rental company on all the claimed damages, an invoice proving that the costs were withheld from your account.
- Send all documents to the insurer (in electronic form), and within 3-15 days, you will receive money back on your card.
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What insurance to buy?
Before buying an insurance policy, it is vital to read very carefully what kind of damage it covers. For example, CDW insurance seems to cover damage, but in most cases, it does not cover damage to glass, wheels, tires, or interior. So, you may find yourself in a situation where you need to pay significant sums even if you seem to have insurance against damage.
Another important thing to check is whether there is a deductible in the insurance. It is always enticing to opt for the cheapest insurance. But usually, it has a serious drawback – a large deductible. It is an unconditional amount that you will have to pay on your part in case of an accident.
The size of the deductible ranges from € 0 to 2000 +. For example, if the deductible is € 500, then any damage to the car up to this amount is paid by you. If damage costs exceed this amount, then € 500 is charged from you, and everything above is covered by the company. The lower is the deductible, the more expensive the insurance policy will cost.
You can protect yourself from paying the deductible by purchasing additional insurance with full coverage or a 3rd party car hire excess waiver insurance. If you are a frequent flyer and rent cars in multiple locations worldwide car hire excess insurance might save you a lot of money. It is strictly recommended for inexperienced drivers who do not feel secure while driving. Besides, this policy option is often relevant abroad if the client does not speak a foreign language very well. Of course, insurance is a voluntary thing. But it is justified to take into account all the possible scenarios and take care of all the little things to avoid additional expenses.