What is car hire insurance excess? Do you need car hire insurance when taking a car rental at Gran Canaria Airport? The extra insurance cost presented to travellers at the rental agency is one of the biggest complaints about car hire. These are termed “Excess Insurance Payment” and “Collision Damage Waiver”.
Many customers are totally unaware that there usually is an “Excess Premium” that can sometimes cost more than the price of the rental car!
When you first book your car hire the rental company will normally include cover for Collision Damage Waiver (CDW) and Theft Protection. This is a basic insurance cover included in your car rental price. This means the rental company will partially cover damages incurred in the event of an accident or theft. It is not a full comprehensive insurance cover. Also it is just for the car, therefore does not include loss of keys, or windscreen damage. The insurance cover does not cover damage to tyres or the undercarriage.
So that explains what basic cover is included in the price when you hire the car. You will still be liable for the Excess Premium if an accident occurs and damage is the result.
There is also Theft Protection Insurance which covers for costs associated to the theft or attempted theft of the rental vehicle. However it does not cover the loss of personal possessions that were in the vehicle at the time of the theft.
The “Excess” premium is payable if the car is damaged due to an accident, or the car is stolen or the keys are lost. Please be aware that some car rental companies also charge for clutch failure during the rental period.
The amount of the “Excess” varies depending on what car you decide to hire and each company has it’s own excess amount. Prior to making a reservation, confirm what excess amount will be charged. Please note: This amount will be held by the car rental company on your credit card in case such an event should happen.
There is a way to free up your credit card and avoid the rental company putting an excess hold on your card. Basically the hire car company will offer you their Excess Insurance Policy. You can pay for this when collecting your car. However, this can be very expensive, sometimes costing as much as £30.00 per day!
There is a cheaper option. This is Damage Refund Insurance. When making your booking through this website you can choose this option and it will reduce your excess liability. You will receive a full refund for any Excess paid.
However, this will not stop the rental company taking the excess amount as security on your credit card. Even if you show them the documentation as proof you have this extra insurance. They will usually still try and get you to buy their insurance to cover the excess. However this is not necassary. When you return the vehicle undamgaged they will unblock the hold they put on your credit card.
Due to any damage or theft the rental company will deduct the cost of the damage from your credit card. You will then need to re-claim this amount from the Damage Refund Insurance company. Therefore, it is important that you obtain an estimate or invoice from the car rental company for the cost of the repair.
Basic insurance is included in the car rental price but comes with a hefty excess that is blocked on your credit card.
To cover for this excess you can take out excess insurance cover with the car hire company itself when you collect the car. This will prevent any block on your credit card but is the more expensive option.
Alternatively you can use a third-party provider that will cover for the excess and can be bought and paid for at the time of making your booking online. This is a cheaper option although a block is still put on your credit card by the hire company. If any amount taken from your card due to damage etc, then this can be claimed back from the third-party insurance provider.