Heading to Europe on business or a vacation? If a rental car is part of your planning, you should also be aware of your responsibilities for that vehicle. While it is possible that your credit card or travel insurance may offer some coverage for your rental vehicle, protection can vary dramatically and, in some cases, coverage can be excluded when you are out of your home country.
Liability Coverage is Included in Your Rental Fee
Car hire insurance in Europe typically includes mandatory liability coverage that is included in the rental fee. This type of coverage can be used if the car is damaged or if the renter causes harm to someone on the road. It is important to check the maximum protection cover amounts for personal injuries and material damages for the specific European country you plan to rent a car in, as they may vary.
Most car rental companies offer a Collision Damage Waiver (CDW) or a Loss Damage Waiver (LDW) which can help lower your out-of-pocket costs if you are in an accident. However, both protections come with an excess or deductible that must be paid and this can range from $500 to $2,500 or more.
An excess insurance policy is a very affordable way to make sure that an excess or deductible payment doesn’t ruin your holiday. This coverage will reimburse you if you must pay the excess or deductible due to an accident with your rental car.,
This guide will walk you through all you need to know about CDWs and LDWs in the UK and EU as well as how an excess insurance policy can help you save money while renting a car.
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Rental Car Coverage in Europe
Hiring a car in Europe can be dramatically different than renting in other countries, particularly when it comes to insurance coverage.
In most cases, if you damage a rental car, you will be on the hook for the cost to repair or replace it unless you have some type of damage waiver in place.
Most rental car companies in Europe offer a Collision Damage Waiver (CDW) or a Loss Damage Waiver (LDW) which helps limit your out-of-pocket costs if the car is damaged or stolen while you are renting it. There is one major difference between the two and they both come with an excess or deductible that will need to be paid so it is important to understand what a CDW or LDW covers and what it doesn’t.
In addition, it is possible to purchase excess insurance for rental cars which will reimburse you for the excess or deductible that comes with a CDW or LDW. Keep reading to learn everything you need to know about protecting your wallet when renting a vehicle in Europe.
What is a CDW?
A Collision Damage Waiver or CDW is protection you can purchase when renting a vehicle in Europe that puts a cap on your financial obligation if the vehicle is damaged in a collision. A CDW is not insurance. A CDW will cover the cost to repair your rental vehicle as well as cover any loss of rental income for the rental agency if the vehicle is damaged in a collision.
A CDW does come with exclusions, it only covers the bodywork of the vehicle, excluding other sections of the car. In addition to limited coverage, a CDW has an “excess” or “deductible” that must be paid by you before it will cover the balance of the repair.
A CDW is designed to limit the amount you will have to pay out of pocket if the car is involved in an accident. While it can vary by rental car company and the type of vehicle you rent, the excess or deductible will usually range between $500 and $2,500 but it can be much higher in some cases.
What is a loss damage waiver?
A loss damage waiver or LDW simply combines a CDW with theft protection (TP), so the vehicle is not only protected from body damage but theft as well. A LDW will cover the following:
- Theft of car
- Vandalism damage
- Collision damage
- Fire damage
- Damage caused by acts of nature
There are some rental car companies that only offer an LDW, eliminating the CDW. An LDW also comes with an excess or deductible that must be paid if you are involved in an accident with your rental car, while it varies by company and other factors, the excess or deductible often ranges between $500 and $2,500.
What is excess insurance for rental cars?
As mentioned above, both a CDW or LDW comes with an excess or deductible amount that must be paid if your rental car is damaged or stolen, which often ranges between $500 and $2,500. Excess insurance simply reimburses you for any excess or deductible amount that you must pay on a CDW or LDW if you are involved in an accident with your rental vehicle.
How does excess insurance work?
The amount of CDW and LDW liability or excess will vary depending on your car rental company as well as the type of vehicle you are renting and the location of your rental. In Europe, the excess payment will usually run between € 500 to €2,000 (£430 – 1,750) for a common car type. In many cases, the excess or deductible amount will exceed the cost of renting the car.
If you are involved in an accident or the vehicle is stolen, you will have to cover this excess or deductible amount out of pocket. As an example, if you hire a car whose value is €20,000 with an excess of €1,000, you will have to cover that €1,000 out of pocket if the rental car is damaged.
Car rental excess insurance may refund the entire €1,000 excess cost depending on your excess insurance policy and benefits cap. Car rental excess coverage is available to everyone driving in the EU or UK, you do not have to be a resident to purchase this coverage from CarInsuRent.
What Does Car Hire Excess Insurance Cover?
While the rates and terms will vary by plan, in most cases, the following are covered by both a daily car hire excess plan as well as an annual plan which covers your car rentals for a year:
A typical European car hire excess insurance excludes the following:
- Rentals where the insurance policyholder is not mentioned as the main driver
- Policy purchased after the rental has started
- Vehicles over 10 years old
- Very expensive high-end vehicles
- Any damage that is caused by off-road driving.
- Commercial vehicles or any vehicles with more than 9 seats unless you have purchased specific coverage
- Charges for services that are the rental company’s responsibility. This includes things such as a mechanical breakdown or towing costs
Always read the policy in full so you are aware of both what is covered and what is excluded. There can be restrictions or requirements for non-EU or UK residents.
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How to File a Claim
- What to Do in Case of an Accident or Damage – If you are involved in an accident while driving a rental car, there are certain steps you should follow to file a claim with the rental car insurance company. First, exchange personal information with the other driver, including name, address, license plate number, rental vehicle information, insurance company, and policy number, and document the accident with pictures and notes. If the other driver is at fault, you should get their contact and insurance information and call their insurance company directly to file a claim. If you are at fault or have non-collision damage, you can file a claim with the rental car insurance company. The process for filing a claim with the rental car insurance company may vary depending on the provider, but typically, you would need to provide details of the incident, including the date, time, and location of the accident, as well as any police report numbers, if applicable. Additionally, you may need to provide documentation of the damage, such as photographs or repair estimates.
- Required Documentation for Filing a Claim
- A copy of the Certificate of Insurance
- A copy of the rental agreement
- A copy of the police report if:
- you got in an accident with a third party
- It is legally mandated in the country of incident
- your claim is about stolen personal belongings
- A copy of the damage report given by the rental company, detailing each cost incurred. Photographs of the damage are optional but may help ensure that the charges are reasonable.
- Detailed repair receipts, invoices or other documents showing the breakdown of the amount the rental company charged you for the accidental damage or loss
- A copy of your credit card statement that reflects your payment for the claimed damages
- A copy of the driver’s license of the person driving the car during the accident
- Tips for a Smooth Claims Process: Filing an insurance claim can be a complicated and stressful process. The following tips can help ensure a smoother claims process:
- Document everything: Documenting all the details of the accident or loss, including taking photos and notes, can help speed up the claims process and reduce the possibility of disputes.
- Communication: Communication is key in any insurance claim process. Keep thorough records of all communication with the insurer, and discuss your expectations for the claims process with the adjuster. You can also ask about the frequency of updates and the preferred type of communication.
- Avoid duplicate claims: Avoid submitting duplicate claims, as it slows down the claims payment process and creates confusion.
- Understand your coverage: It’s important to understand your insurance coverage, including the limits and deductibles, before filing a claim. Understanding your policy can help ensure that you receive the maximum benefit to which you are entitled.
- Be patient: Claims processing can take time, so it’s important to be patient.
By following these tips, you can help ensure a smoother claims process, and increase the chances of receiving the maximum benefit that you are entitled to under your insurance policy.
Do I need Car Hire Excess Insurance in the UK & Europe?
While there is no legal requirement to carry car hire excess insurance cover in Europe, it is often a good idea. If you can easily afford to pay up to €2,500 in the event you are in an accident with your rental vehicle, then there is no need to carry car hire insurance excess.
However, if covering a €2,500 bill would ruin your vacation or impact your budget, you should absolutely consider purchasing a car hire excess policy.
It’s important to note that in addition to the €2,500 excess or deductible, most CDWs and LDWs exclude coverage for items such as all the windows in the vehicle, tyres, lost keys, and even misfuelling the car which means your out-of-pocket costs could be much higher than the excess or deductible payment. A car hire excess policy will cover these losses up to the coverage limits in the policy.
Purchasing a car hire excess policy is not the only way to protect your finances when renting a car in the E.U. or U.K. Here are a few different options that may be available to you:
Car Hire Excess Insurance
The simplest way to protect your vacation budget from unexpected rental car expenses is to purchase a European car insurance excess waiver from CarInsuRent. This policy will cover the cost of your excess or deductible up to your coverage limits. We sell a variety of different policies including daily and annual excess waivers. Once your claim is filed, we will pay the claim within 5 business days. Our policies are very affordable with an annual policy only costing $89.
Credit Card Coverage
Some credit cards do offer car rental insurance that offers zero-deductible collision coverage as well as some liability coverage. However, there can be numerous exclusions with this coverage, particularly if you are out of your home country.
It is always important to contact your credit card company before traveling to verify they offer coverage in the locations you are traveling to as well as any exclusions to coverage.
You may find that the coverage offered is not sufficient or offered where you are traveling. If your credit card does offer coverage, you can forego the CDW or LDW offered by your car rental company.
Collision Coverage Through Your Travel-Insurance Provider
In many cases, you can add-on collision insurance to a travel insurance policy. Coverage and exclusions will vary by policy so be sure to read it in full to make sure you understand what is covered and what is excluded.
Super CDW or LDW
A Super CDW or LDW ups the coverage when compared to a standard CDW or LDW. These waivers cover more of the vehicle while also reducing the excess you must pay in the event you are in an accident. While some SCDWs or SLDWs take the excess or deductible down to zero, these waivers can be very expensive and may come with additional exclusions.
CarInsuRent and Non-UK Residents
A CarInsuRent car hire excess policy is often one of the best options for non-UK residents renting a vehicle while traveling in the UK or EU. Our policies are very affordable and can be a financial lifesaver if you are in an accident while renting a car in Europe or the UK. Check our prices now and make sure your rental car is fully covered while traveling.
CarInsuRent urges you to drive safely and stay insured!
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What is a CDW?
A Collision Damage Waiver or CDW is protection you can purchase when renting a vehicle in Europe that puts a cap on your financial obligation if the vehicle is damaged in a collision. It is not an insurance policy.
A CDW will cover the cost to repair your rental vehicle as well as cover any loss of rental income for the rental agency if the vehicle is damaged in a collision, but it does come with a variety of exclusions so make sure you understand the limitations of these protection.
A CDW comes with an excess or deductible that you will have pay out of pocket if you are involved in an accident. It will vary by rental car company and the type of vehicle you rent, but in most cases, the excess or deductible will usually range between $500 and $2,500 but it can be much higher in some cases.
Is CDW Insurance Mandatory in Europe?
No, CDW is optional in Europe except for Italy where it is a required coverage. Most European car rental companies include liability coverage as part of their baseline rate and offer a CDW or LDW as optional coverages you can purchase.
Is LDW and CDW the same?
LDW stands for Loss Damage Waiver and an LDW if very similar to a CDW, but it includes theft protection (TP) as well. Some car rental companies only offer an LDW, eliminating the CDW. An LDW offers the same protections as a CDW, but it also includes protection if your rental vehicle is stolen.
What is the difference between CDW and excess waiver insurance?
A CDW offers protection for your rental vehicle, it will pay to repair the body of your rental vehicle if it is damaged in an accident. However, a CDW comes with an excess or deductible payment that you must pay out of pocket, and this can range from $500 to $2,500 or more.
Excess waiver insurance will refund the excess or deductible amount that you must pay on your CDW if you are involved in an accident up to the policies benefit ceiling. Excess waiver insurance is very affordable and can be a financial lifesaver if you are in an accident with your rental vehicle.
Which insurance is best for a rental car?
While your needs will vary depending on where you are going, in most cases, the best combination is a CDW with an excess waiver insurance policy. This will ensure the vehicle is repaired if it is damaged in an accident and you will not have to pay a huge excess or deductible out of pocket.
About the author:
Mark Vallet have over 15 years’ experience writing about insurance and automotive subjects. Mark have written for autos.com, carsdirect.com, YourMechanic.com, and is also a regular contributor to carinsurance.com, insure.com and insurance.com. His work has been published online at MSN, Yahoo Autos, Fox Business, Business Insider Australia and more.