Car Hire Insurance Explained

Renting a car can be a daunting experience – language issues, local car rental laws, different driving rules, jargon and extra charges can all make life complicated. Tipoa Car Hire clarifies in this document some of the terminology used and offers useful tips on successful car hire.

1. Let’s start at the beginning...Choosing your hire car

There are plenty of car hire companies (suppliers) out there (e.g. Hertz, Avis), there are plenty of brokers out there (e.g. British Car Hire, Tipoa, TopAutoverHuur). In fact if you go to Google and enter some of the key search terms such as ‘car hire’, ‘car rental’, ‘cheap car hire’ you will be bombarded with plenty of options. Let’s start with the car hire companies (suppliers). These are the well-known international brands that we are all familiar with. Hertz, Alamo, Europcar, large multinational companies with a presence in most cities and airports. These also include local outfits, which own cars and operate them at the destination.

2. The Extras

Fuel
If an option, take the car with a full tank of fuel and return the tank with a full tank of fuel. Find out where the closest fuel station is when you collect the car so you know where to go on the way home. The reason that the rental company wants you to prepay for gas is simple. You will always return the car with gas in it. Nobody will take the chance of running out of gas by trying to run the tank empty.

Additional drivers and young/old driver surcharges
Think who will be driving the car and check the costs for adding an additional driver or more. An additional driver can usually cost an extra £3-£6 per day payable locally.
The minimum rental age is normally 21, though if under the age of 25 you are likely to incur an extra daily charge.

Child Seats
Infant/booster seats for children under 12 years are mandatory in most countries in the EU, so should be provided if requested.

Snow Chains/Ski Racks/Snow Tyres
If you are heading for the snow then think about all the equipment that you have and the size of car that you will require.

Late return fees
Check exactly what the late return fees are.

Mileage
Unlimited mileage tends to be the norm.

Excess Waiver
Excess waiver is the additional insurance that is sold to you at the counter when you collect your car to either reduce your excess in part or in total.

PAI (Personal Accident Insurance)
Pays out if you kill or maim yourself or a passenger.

Personal Effects
Covers your personal effects such as baggage if stolen from your vehicle.

3. Insurance Explained

What insurance is included and what is excluded is often the most difficult element to understand when hiring a car, so let’s make it simple.

There are a few ways to reduce your excess to zero

     a) Super CDW

     b) Damage Excess Waiver (DEW)

     c) Excess Insurance

4. Collecting The Car

You have just arrived at your destination and all you want to do is jump in the car and go. There’s a queue, you have the kids with you and the temptation is to just rush everything. It’s quite simple. DON’T.

Once you are in the car...

Familiarise yourself with the vehicle: your seat position, lights, heating, wipers, warning lights.
Visit www.theaa.com/motoring_advice/overseas/

5. Returning The Car

The same principles apply when returning the car. DON’T RUSH!

1. Take photographs of your rental car when you collect it and return it.
2. Try to avoid returning the car outside of normal office hours, as just leaving the keys means you have not gone through the full return process, and you are liable for the car until the car rental company opens the following day.
3. Inspect the car with a representative of the car rental company to ensure that there are no problems.
4. Wait for a printed copy of the final report.
5. Take photos of the car when you return it to show that there is no damage.
6. Check the seat pockets and seat wells for any items that you might have left in the car.
7. Finally keep the copy of the car rental agreement and any damage report until your next credit card statement arrives. That way if you need to claim on your insurance or dispute the transaction you will have the information to hand.

For more detailed information, please download our Insurance Brochure:

Source: Daniel Smith from Insurance4carhire.com
Follow Tipoa's travel writer Uxia Olsson's blog

Car hire: 10 ways to avoid being ripped off

1. Buy the basic package only

The secret to saving money on car hire is to buy the basic package only. Hire Car suppliers make all their profits by selling you the add-ons, which are usually absurdly expensive. In particular, ignore pressure to buy their collision damage waiver (CDW) or "super" CDW insurance, which will cover the "excess", usually 500-1,000, not covered by the basic insurance. Instead, arrange your own cover independently - see step three.

Use online agents such as Tipoa Car Hire to check hire prices first.

If possible use off airport operators -  often you can avoid lengthy rental desk queues at peak airport terminal times, and they usually offer a wider and cheaper range of vehicles. Hire deals organised by airlines such as Ryanair's link with Hertz or going to the hire firm direct are rarely better value than using a broker.

2. Bring your own satnav and child car seats 

We tested the cost of hiring a satnav for a week in Italy with Hertz and were asked for €97 (£78.50) for one week. In Spain, Europcar wanted £77. This is a waste of money. You can buy a new satnav that covers both the UK and Europe for around £50-£60, or bring your own.

Child seats are more tricky. Hertz wanted £78.50 while Europcar asked for £74, and £60 for a booster seat. But if you are flying with a charter airline such as Monarch, it is free to take a child seat with you. Booster seats cost as little as £8 to buy in the UK, indicating just how overpriced the car hire deals are.

If you are flying on a low-cost airline such as Ryanair, check the additional baggage cost when booking. Ryanair charges £10 each way for a child car seat, so even with this extra cost it can still make sense to bring it along.

3. Save £100 by buying excess insurance

Most car rental companies charge an Excess. If you have a claim - typically you pay the first € 500 or so. Also, most policies issued by car rental companies don't cover windows, tyres, undercarriage, roof or loss of keys.

Excess Insurance from our third party partner ALLIANZ GLOBAL ASSISTANCE gives you complete peace of mind for just € 5.65 per day. The policy will cover up to € 2390.52 of any excess; it can be used on any vehicle type and if your particular vehicle can't be confirmed, you can use it with any rental company so you won't lose out. Please note: Excess Insurance is billed separately on your credit card statement…

UPDATE: Many suppliers now realise they are loosing a valuable income with brokers such as Tipoa Car Hire offering comprehensive Excess Insurance online, so you may see some all inclusive deals, promising " zero excess ' but beware, these are not comprehensive and they still so not cover many of the things they should, such as tyres, loss of keys, window damage.

4. Ignore the sales patter at the collection desk

This is where you need to be strong. Don't be persuaded to buy insurance you have already paid for (above). When you fill out the rental agreement, the local agent will try to sell you their super CDW that reduces the excess to zero. They will tell you that your insurance isn't valid (it is) and they will try to sell you windscreen wheel, tyre, and undercarriage insurance.

Assuming you have a policy, don't fall for it and take a copy of the ALLIANZ policy with you. We get lots of complaints about this, and the car hire firm is under no obligation to refund you because you bought two policies - nor is the agent you hired the car from. If you paid twice, it's your mistake.

When you refuse the extra cover, the rental firm will "pre-authorise" a sum to cover the excess on your credit card - typically £600 or so in the local currency. This is normal and allows the firm to charge your card the excess if you do have a crash. They will also charge you for the fuel if appropriate.

You will need enough available credit on your card to handle both.

5. Check the fuel policy, the mileage and other extras

Before you hand over your credit card details, look up the company's fuel policy. If you are driving a long way, does your rental limit the mileage in any way? If you are under 25, is there a surcharge?

A growing number of firms (for Spanish rentals in particular) now insist on a full-to-empty fuel policy on rentals of more than three or four days. You pay for a full tank of fuel and then bring it back empty, which is fine in theory, but if you aren't using the car much you'll end up paying for three-quarters of a tank of fuel you didn't use.

Renters on the small Spanish islands report it being impossible to use a full tank of fuel. Even the big firms now adopt this policy. The only way round it in Spain for those on a week's holiday is to go for a series of short rentals. Elsewhere, such as Italy, it is less prevalent, but starting to appear.

UPDATE: You can choose your fuel policy and view the cost, online prior to making your reservation at Tipoa.com STEP2. Look down the left hand side for the filter and click on FUEL POLICY

6. Note all damage, and video or photograph the car

This is the key moment. Before you leave, go round the car and look for any damage and mark even minor scratches on the rental agreement. Don't leave anything off. Same for the interior. Check the spare wheel is there, inflated and undamaged. Check the car is full of fuel if it supposed to be, and record the mileage, if it's restricted.

Once you have marked all the damage on the sheet, get someone at the rental desk to sign it - even if it is a long walk or drive back to the desk. If you don't there is nothing to stop the firm arguing that you caused the damage at the end the rental.

Once signed for, there can be no dispute. Take a video or digital pictures of the car (especially any pre-existing damage) as extra proof.

7. Photo the car on return and keep the paperwork

Assuming you have done no damage, and have filled it up (if required), park it up and then take digital photos of each panel of the car, the wheels, the mileometer, and other shots.

Hand the keys back to the person at the desk. If late at night post them through the letter box. Be wary if approached by someone in the car park claiming to work for the car firm. One reader faced a lengthy battle after his car was stolen in this way.

Lastly, keep hold of the paperwork. Don't throw it away, thinking the rental is over - it's not.

8. Keep an eye on your credit card statement

Check your credit card statement a few days later to make sure promised fuel payments and excess charges are returned and keep an eye out in later statements that no extra payments have mysteriously materialised.

9. Fight any additional charges

If you have wisely bought excess protection, simply claim from the firm in question. If the claim is spurious, pass this on to them and let them sort it out. If you bought the car hire firm's policy (why?) and the claimed damage is not covered - it rarely is - then it is time to go into battle.

Send a copy of the photos you took, and talk to the company. Some, particularly those in Spain, will ignore you. 

Ask for evidence of repairs that were supposedly carried out.

If you don't get anywhere and know you are innocent, raise the dispute with your credit card provider. The card firm may again try to ignore it. It will then be up to the car hire firm to prove its claim is valid.

Tipoa Car Hire welcome emails from you on these matters.

10. So which car hire company do you go with?

Shop around, of course, and consider Tipoa Car Hire. It has the advantage of offering a one-stop shop in that you can buy its basic rental - it also offers excess insurance and you can reserve your extras, such as baby seats, ski racks, GPS all in the same booking.

Just remember if you've already paid and don't pay again at the rental desk.