If they ask the question at all, many people would be uncertain whether or not they have enough rental car insurance coverage. An insurance package is almost always included in the quoted cost of the rental and it seems reasonable to assume that the cover provided, therefore, is all that is needed. Unfortunately, this is probably not the case and a costly disappointment could lie in store for any driver caught out by inadequate cover.
Do You Have Enough Rental Car Insurance Coverage?
If they ask the question at all, many people would be uncertain whether or not they have enough rental car insurance coverage. An insurance package is almost always included in the quoted cost of the rental and it seems reasonable to assume that the cover provided, therefore, is all that is needed. Unfortunately, this is probably not the case and a costly disappointment could lie in store for any driver caught out by inadequate cover.
To understand the potential deficiencies of the rental car insurance coverage provided in the cost of the hire car, it is useful to look more closely at what this is likely to comprise and to make a point of asking the rental company about any limits, exclusions and excesses that might apply.
These days, most companies will make the point in their advertised rates that a collision damage waiver is included in the daily rate of hire. This is effectively the form of insurance that protects the hirer against having to pay for any damage to the vehicle whilst in his or her possession.
Although it might seem that the relatively high cost of this waiver should provide ample protection, there are a number of ways in which the cover is, in fact, limited. There is likely to be an excess, for example, which leave the hirer exposed to quite significant financial risks. In the UK, this is typically as high as £600, but in other parts of the world can well exceed £1,000. An excess, of course, as with any type of insurance, is the first part that needs to be paid by the individual in the event of a claim. In this case, if the damage to the hired vehicle is relatively minor and less than the excess, then the hirer will be responsible for the whole repair bill; if there is major damage, then the hirer's financial responsibility is limited to the whole of the excess.
Furthermore, most collision damage waivers exclude the cost of repairs to certain parts of the vehicle - typically, the wheels and tyres, glass and windows, roof and undercarriage. Damage to any of these parts of the vehicle, therefore, would remain the responsibility of the hirer.
Whilst the rental car insurance coverage is also likely to include protection against theft and attempted theft, these claims are also likely to be subject to an excess.
Given these excesses and the potential for damage to the vehicle that is excluded under the terms of the collision damage waiver, most rental car customers therefore seek additional insurance coverage to protect against such risks. Furthermore, in addition to such excess insurance, many drivers also review the amount of cover protecting them against claims from third parties and consider it prudent to increase the level of the protection afforded by the typical, basic rental car insurance coverage deal. This is designed to significantly increase the normal limitation on the settlement of third party claims and make the maximum amount available up to a typical $1 million.
Simon Vella is Chief Executive of Insurance4Carhire an independent specialist broker dedicated to providing their clients with the best deal on their rental car insurance and car hire insurance.
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http://www.insurance4carhire.com
http://www.dailyexcess.com
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