We like to think our car excess insurance is nice and straightforward. Your car rental agreement however, might not be so easy to understand. With this in mind, we’ve put together a guide to car hire costs.
How much does it cost to hire a car?
There is no single answer to this question - the price of hiring a car can vary widely due to a number of factors:
- The size of the hired car
- The make of the hired car
- The availability of the hired car
- The location
- The length of time the car is hired for
These will all factor in to the cost that is presented upfront when you are hiring a vehicle. Be aware that car companies may advertise cheap prices, but are in fact only referring to small, older vehicles - which may not be ideal if you're hiring a car for a family or larger group. Therefore it's important to know all of the above details about the car you're hiring before you sign or pay anything.
Are there any hidden costs when it comes to hiring a car?
Above, we've talked about the more obvious factors that contribute to the advertised costs of hiring a car. But there are other costs involved that may not be immediately obvious, or may only apply to particular drivers.
Credit card deposits and car hire credit card blocks
Some car hire companies will put a credit card block when you hire a car so that if you do damage the car, they know you have the funds available to pay for it. Of course, if you do have to pay for damage, you'll be able to claim this back from your car hire excess insurance policy. However, you will need to check the limit on your credit card and check how much your car hire company will need to block off.
If for example your credit limit is £1000 and the car hire company needs to block off £900, you might find yourself short of money before your holiday has even started.
Some car hire companies will offer you their insurance to reduce this credit card block but if you've already bought an insurance4carhire policy this will feel like an unnecessary expense. Unfortunately however, there's no way around this. The best course of action is to shop around before you book your hire car to find a car hire company which doesn't require much of a deposit from your credit card.
It’s one of the most common hidden charges. Make sure you know how much fuel should be in the tank before returning the vehicle. There are normally two different procedures:
- Supplied full and return full – so, you’ll only pay for the fuel you use. Be aware, if you return the car with an empty fuel tank, the car rental company may charge you for the price of a full tank of fuel. It’s best to fill the car back up yourself to ensure you’re not paying over the odds.
- Supplied full and return empty – this way, you’ll end up paying for a full tank of fuel. Again, this can be costly if you’re not planning on doing much driving.
Tip: Misfuelling is when you put the wrong type of fuel in the car and it damages the engine. If you’ve bought an annual policy with insurance4carhire, you can claim back any money the rental company charges you in excess fees as a result of this damage.
Documentation for additional drivers when hiring a car
Some rental companies will include an additional driver for free whereas some will charge an extra fee per day. Check your documentation before you travel to see if you have to pay for additional drivers.
Tip: All insurance4carhire policies will cover for excess charges imposed by the rental company, for up to seven additional drivers providing they’re listed on the car rental agreement.
Car hire age restrictions
Some rental companies will charge you an extra fee if you’re under 25 – this is known as a ‘young driver fee’.
Others may have a maximum age restriction whereby you’ll either have to pay extra to hire the car, or in some cases it’s made compulsory to purchase their own excess reduction insurance.
Tip: insurance4carhire can cover drivers between the ages of 21 and 85 against excess charges imposed by car rental companies.
‘Quick’ drop offs
Not every rental company is open all hours, especially the smaller firms. Most of these operate a 'drop and go' procedure for out of hours. This means when you return the car, you’ll drop the keys in to a box at the rental company.
If you’re going to do this, be sure to check your credit card statement when you get home in case you have been charged extra for anything. Some other companies will deem you liable until they inspect the vehicle the next time they open, so if you’re on your flight and somebody scratches the car, you may still be charged.
Car hire terms explained
You may be offered various kinds of insurance at the rental desk, or you may find these included in your rental agreement. Here are some examples of car rental jargon to look out for. Please note that this jargon may vary between car rental companies.
CDW, or Collision Damage Waiver insures the vehicle against damage; however don’t assume this will cover everything. Normally, this excludes damage to windows, tyres, undercarriage and roof. You’ll normally be left liable for an ‘excess’ otherwise known as a ‘deductible’.
LDW, Loss Damage Waiver is effectively the same as Collision Damage Waiver. Normally this includes theft protection.
SCDW, Super Collision Damage Waiver is damage excess cover which either removes or reduces your liability for any excess.
TP – Theft Protection insures the vehicle in the event of theft. Be aware, an excess may apply.
PAI – Personal Accident Insurance is passenger insurance for injury or death.
ALI – Additional Liability Insurance is an optional insurance to protect authorised drivers if they injure someone or damage someone else’s property.
Why choose a policy from insurance4carhire?
Excess cover is often offered when you pick up your rental car, but at a high cost - between £9 and £20 per day. A policy from insurance4carhire will cost you from £12.79 per trip or from £46.99 per year* and will cover your excess - up to £6,500 per claim.
About the author
This is a marketing article from insurance4carhire by our car hire excess insurance business unit director, Adam Summersby. Adam is a respected leader with 11 years’ varied experience in niche personal and commercial lines insurance, including caravan, site operators and excess reimbursement, with proficiency in leadership, sales and account management.