Category Archives: Car rental excess insurance

A Typical Greedy Car Rental Company

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Check this out and see why finding an alternative to the car rental companies’ insurance is a necessity. If you have ever rented a car in Australia or New Zealand you will notice the sinking feeling you get while at the rental desk.

We have been in the car rental industry for over 15 years and the one thing that we found that the customer hated is dealing with the insurance.

Below are the rates of a typical greedy car rental company for their CDW
(Collision Damage Waiver – they are not allowed to refer to it as insurance)

  • They leave you with $6000 liability
  • For $38 a day they reduce your liability to $1100
  • For $49 a day they will reduce your liability to $550

That can be more than the rental itself!

Alternatively Tripcover’s rates start from $9.30 per day with a $300 excess and
reduces down to $5.61 over a 15 day rental.

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Another Good Reason to Take Out a Tripcover Policy

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ProductReview Quote:
“I rented a car in late June to drive to southern Victoria with my family. On our way to Melbourne, we hit a kangaroo at a very slow speed.It damaged a fog light and broke the bumper. The result was a big repair bill. Thankfully, I bought Tripcover insurance for the trip. After I got the invoice from the car rental company, I filled in the claim form and attached the invoice, rental contract and damage report to the insurance company. They asked for the detailed invoice and within about 10 days, i got my reimbursement less a small amount. I would use Tripcover again.” Alf

And don’t for get that AAA members can now use their 16 digit membership card number to get a 5% discount with Tripcover.

Do your research to avoid car rental shocks

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Rental cars are costly. If the upfront hire fees aren’t enough, there are lots of other charges that can double the cost. That can be anything from increased insurance costs to reduce excesses, to hiring a child seat.

If you know how the system works, however, it’s possible to minimise costs.

If you’re booking a hire car, the first thing to do is to use comparison engines that list more than one rental car company……more>

 

Company Policy Now Available

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Now your company can cover ALL the eligible aged drivers employed in your company.
Yes, that’s right, why pay the car rental company’s expensive corporate excess insurance rate when you can use Tripcover’s much cheaper car rental excess insurance.

Simply have the car rental agreement in your company’s name and away you go.
Reduce your corporate rate with the car rental company and save. Just let them know that
you do not need their CDW or Collision Damage Waiver to cover your company’s excess
anymore and each time you take a rental out get one of our policies for the employee.

Clarifying Your Car Rental Insurance Choices

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Loss Adjuster Inspecting Car Involved In Accident
When renting a car in Australia or New Zealand, it is very important to have quality car rental excess insurance coverage for the vehicle. You have several options available, and by comparing and contrasting the different types of insurance, you can have a better idea of what you might need.

Credit Card
Many times, the credit cards you already have in your wallet will actually have collision coverage included on them. If you choose the right credit card to pay for the rental, you could actually receive coverage with zero deductible, or at least a very low deductible. This is quite different from the high cost of insurance through the car rental companies. The right card has the potential to provide coverage for the costs for which you might be liable, such as damage to the car, or even a theft but a lot of times does not cover the general exclusions such as windscreen, tyres, single vehicle accidents or undercarriage damage.

Another issue is that some that use this method of coverage for their rental vehicles have is that it can be a hassle to deal with the credit card companies. Still, given the amount that you could possibly save in the event of an accident, it does make sense at least to consider utilizing credit card coverage for the rental.

Make sure that your credit card company offers this type of coverage, as some do and some do not. Look through the policies regarding the coverage it offers, and make sure it is applicable in Australia or New Zealand – or any country you might be visiting for that matter.

Standard Travel Insurance
In some cases, you may also have collision coverage available through your travel company. If you buy a travel insurance policy for your vacation through many companies in Australia and New Zealand, you will have the option of adding on insurance for your car rentals. However, it is important to make sure that the travel insurance policy that you are considering using actually cover all the normal exclusions that the car rental companies exclude, such as windscreens and single vehicle accidents.

Dedicated Car Rental Excess Insurance
Of course, there’s always the option of buying your car rental excess cover (usually called CDW or Collision Damage Waiver) from the car rental company. This is something they will actually encourage you to do. It’s a simple solution since you can do it right at the counter. However, that does not necessarily mean it is the best solution. The cost of the insurance through the company is expensive, and could be close to the cost of the rental itself, which could double your overall expenditure. When you buy insurance through the rental company, you should not think that it will automatically cover the entire cost of damage or theft. Look at what your excess or deductible will be. It can be in the thousands in many cases. Car rental companies will sometimes offer an additional form of coverage that will drop the deductible to zero. Of course, this adds to the cost of your rental substantially.

Dedicated car rental excess cover is also offered now by such companies as Tripcover and this can be less than half the cost of the car rental companies’ rates.
However there is also the hassle of making a claim with their insurance provider Allianz Global Assistance in the event of an accident.

Take the time to research all of your options for your car rental insurance, and then choose the one that makes the best financial sense for you.

Resources:
https://www.ricksteves.com/travel-tips/transportation/car-rental-cdw
http://www.tripadvisor.com.au/ShowTopic-g255103-i531-k5982489-Car_rental_excess_reduction_Tripcover-Perth_Greater_Perth_Western_Australia.html

 

 

ANZ Car Rental Cover – leaves you exposed to excess risk

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Many people use their credit cards to cover their rental car excess. Renters assume that they are fully covered, but are they really?

Let’s have a closer look at ANZ’s actual car rental cover policy, which a Tripcover customer brought to our attention, asking if they should still take out a Tripcover policy or use the ANZ rental car coverage.

ANZ car rental cover policy

What’s covered and what not by ANZ credit cards?

Here’s the thing, most of the large car rental companies, such as Thrifty, have what they describe as a “standard excess”. This excess covers basic damage to the car if it involved in a multi car accident or is stolen, for example. Though there are a number of items not included in the standard excess, and that’s the loophole in credit card travel insurance.

Hence it becomes a problem for anyone who is relying on their ANZ credit card insurance (or other credit cards aswell) because items such as windscreens, tyre damage, undercarriage damage are not considered to actually be part of the excess.

On top of that, most rental firms in Australia have an excess amount between $3500 and $4000. The ANZ car rental cover falls short by nearly $2000.

car rental excess coverage amount

ANZ only covers $2050 excess.

The above screen grab from the ANZ Car Rental Cover terms and conditions, shows the maximum excess insured is just $2400, minus the applicable policy excess, leaves the rental customer will only $2050 maximum coverage. So if the rental car excess is $4000, then there is a gap of $1950 to pay. Ouch!

Credit card car rental insurance leaves you exposed

Single Vehicle Accidents are not covered by ANZ

In the above screen grab from ANZ’s terms and conditions, you will notice two things. Firstly that the coverage only includes items covered under the collision excess, and as mentioned earlier there are multiple items that rental companies do not include in their excess, but still charge you for, like windscreen and tyre damage etc.

Secondly you’ll notice that Single Vehicle accidents aren’t covered by the ANZ policy, which effectively means, if you damage the car in a car park against a static item or you hit a kangaroo on the open road, you wont be covered because there is only one vehicle involved in the accident, namely you!

As we previously wrote in our blog post about the pros and cons of car rental insurance via credit cards, there are benefits to using credit cards, especially if you choose the right credit card to pay for the rental, you could actually receive coverage with zero deductible. That being said, its worth looking into the detail, as we have done here with ANZ, to really understand what level of coverage you do have, as opposed to assuming you’re covered, and then being surprised when there is a sizable gap in the coverage.

What to Look Out for in Car Rental Quotes & How to Save up to $228 on Rental Excess Insurance

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Before you take the key, know what your damage liability is.

Before you take the key, know what your damage liability is.

When booking a car rental, the price you believe you are paying and the price you actually pay by the time you complete the rental process might be quite different. You may book online and think that you are getting a great deal for a car for $175 for a full week only to walk out of the rental office paying more than double that. What happened? When you consider the addition of all of those extraneous and outside fees, the price of renting really can start to pile up quite quickly and it’s a sinking feeling. Let’s look at some of the things that can push the price, so you will have a better idea of what you need to be watching for with quotes and so you can avoid that sinking feeling.

Taxes

You always need to consider taxes when you are renting a vehicle. It doesn’t matter where you are, there will always be taxes associated with the final cost so make sure you know the taxes in your area and estimate those if the quote does not already do that for you. Keep in mind that in addition to the state taxes, there can also be local taxes. Picking up a rental car in many Australian airports actually costs between 16% and 20% more than picking them up at a downtown location would cost. If you plan to rent for a longer period, it simply makes more sense to pick up from a downtown location instead, as it will save quite a bit of money.

Deposit Fees

Many times, a rental agency will charge your credit card a deposit when you rent. The amount will vary based on the company from which you rent. They will return the amount of the deposit after you return the vehicle, so long as there is no damage to the vehicle and you have not misused it in any way. An example of misuse might be smoking in the vehicle, for example. The deposit fees in Australia and New Zealand are generally between $100 and $500. You need to have at least that much available on your credit card.

Insurance

Of course, you also need to think about insurance. If you have your own car or travel insurance, then there is a chance that you will not have to pay auto insurance through the rental company. However, this is something you need to consider quite carefully. It might be a good idea to choose a collision damage waiver or loss damage waiver so if anything happens to the vehicle you are not responsible for the repairs. In Australia, the rental car excess fee can be as high as AU$4-6,000. It can be very difficult to understand exactly what your insurance will and will not cover. By choosing the insurance through the rental company, it can also remove some of the burden from your own insurance policy. It’s a badly kept secret that car rental firms tend to charge excessive prices to insure the excess, and this is often as much, if not more than, the rental car cost itself. Keep that in mind and consider some of the online alternatives to insure your car rental excess (see comparison between Europcar and Tripcover below*). As always, it is very important to read the fine print on the insurance from the renal firm or other providers– yours and that offered by the car rental company – before you make your final decision.

Save money by understanding what you are covered for

Car rental excess reduction fees from Europcar versus Tripcover

* As mentioned above it can be very complicated to understand the rental car company actually covers. This table has four options from Europcar, with the bottom option being not to cover the excess of $4500. The 2nd option (CDW) reduces the excess liability from $4500 to $990. And if we look at the premium option, called GoZen, this reduces the excess liability to $0 although will set you back $301 for a 7 day rental. Compared to the Tripcover.com.au product, GoZen costs 4 x more and covers less items, given overhead and undercarriage options are not covered. Whereas with Tripcover damage liability to these areas of the rental car are covered up to $4000.

The Price of Petrol

Another cost that you the quote really won’t cover is the cost of petrol. Not only will you have to calculate the cost of petrol on your trip, you also have to calculate how much the rental company requires you to place in the vehicle before you return it. Most often, you need to return a full tank, given the Australian rental companies tend to fill the car up before the rental starts. Find a petrol station and fill up before you drop off the car, otherwise the company will charge 2-3 times higher price per litre, if they have to fill up for you.

Car Drop Off Fees

If you return the vehicle to a different location or city for any reason, there will generally be an added drop off charge. Those who plan to drop off at another location should check their online car rental quote to see if a one-way fee is charged and how much it is. It should be displayed in the actual online quote. If you book on the phone or through a broker make sure to talk with the rental company and let them know it’s a one way rental, and also ask about these fees to get the full picture of how much you will have to pay.

Comparison of Credit Card, Standard Travel Insurance and Dedicated Rental Insurance

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car-rental-insurance-option-comparison

When renting a car in Australia or New Zealand, it is very important to have quality insurance coverage for the vehicle. You have several options available, and by comparing and contrasting the different types of insurance, you can have a better idea of what you might need.

Credit Card

Many times, the credit cards you already have in your wallet will actually have collision coverage included on them. If you choose the right credit card to pay for the rental, you could actually receive coverage with zero deductible, or at least a very low deductible. This is quite different from the high cost of insurance through the car rental companies. The right card has the potential to provide coverage for any of the costs for which you might be liable, such as damage to the car, or even a theft.

There are two issues consumers should keep in mind when using this method of coverage for their rental vehicles.

  1. Check your credit card’s fine print related to rental car coverage exceptions. Often credit cards only cover the rental company’s standard CDW inclusions. This can mean things like windscreen, tyres, undercarriage and hail damage for example, are not included. As a rule of thumb, if the fine print does not say that these items are included in coverage, then safer to assume they are not, and then consider using a different credit card or another method of coverage.
  2. Secondly it can be a hassle to deal with the credit card companies in the advent of a claim.

Still, given the amount that you could possibly save in the event of an accident, it does make sense at least to consider utilizing credit card coverage for the rental.

Make sure that your credit card company offers this type of coverage, as some do and some do not. Look through the policies regarding the coverage it offers, and make sure it is applicable in Australia or New Zealand – or any country you might be visiting for that matter.

Standard Travel Insurance Cover

In some cases, you may also have collision coverage available through your travel company. If you buy a travel insurance policy for your vacation through many companies in Australia and New Zealand, you will have the option of adding on insurance for your car rentals. However, it is important to make sure that the amount of excess coverage is high enough (at least $4000) and check the fine print for exclusions. Similar to credit card cover, travel insurance often only covers the rental company’s standard damage and CDW. For example when renting with Thrifty the standard damage does not include windscreen, undercarriage, single vehicle accidents and hail damage. In this case if your travel insurance only covers standard damage, then it won’t be enough to cover these items.

Dedicated Rental Insurance

Of course, there’s always the option of buying your rental insurance right through the car rental company. This is something they will actually encourage you to do. It’s a simple solution since you can do it right at the counter. However, that does not necessarily mean it is the best solution. The cost of the insurance through the company is expensive, and could be close to the cost of the rental itself, which could double your overall expenditure. When you buy insurance through the rental company, you should not think that it will automatically cover the entire cost of damage or theft. Look at what you’re deductible or excess will be. It can be in the thousands in many cases and often you need to buy the premium coverage option to be fully covered and reduce your excess to zero.

Dedicated Car Rental Reimbursement Insurance

A newer and lesser known alternative to credit cards, travel insurance and insurance direct with rental companies, is car rental reimbursement insurance.  It works very similar to the rental company’s cover, however it costs significantly less, as low as $6.77 per day for a seven day rental, and can be purchased independent of the rental company. This mean that if you damage the rental car, the rental company will still deduct the applicable excess amount from your credit card, however if you have purchased a reimbursement policy, then you receive a refund within 10 days of the claim being made, provided you have driven the car within terms and conditions of the rental contract.

Australia first car rental reimbursement cover provider is Tripcover.com.au, which offers such cover for Australian resident travelling in Australia and around the world, as well as cover to international visitors to Australia. A rental car insurance for New Zealand residents is also available. The products are created and managed in partnership with Allianz Global Assistance.

Now you have real choice

Take the time to research all of your options for your car rental insurance, and then choose the one that makes the best financial and coverage sense for you.