Car Hire Insurance Guide - How car hire insurance works around the world

Car Hire Insurance simplified - I let you know the options you have when it comes to insurance from rental firms

Car Hire Insurance

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Insurance is one of the most confusing elements of car hire - you think you have bought an all inclusive package and think that should cover everything.

Then you arrive, tired after your flight, at the rental desk only to find you are not covered for this, and you could have to pay that. Before you know it you have doubled the cost of your rental package and end up feeling well and truly ripped off!

Our guides cover all the insurances you are likely to be offered, how they protect you, and what your alternatives are.

Main Insurance Definitions

Collision Damage Waiver (CDW)

A Collision Damage Waiver is an agreement between you and the rental company, should there be an accident the car hire firm agree to waive the cost of damages to the rental vehicle. The company will be liable for the major part of the costs of damage to the vehicle, however, it is important to note that you will most likely end up paying the first part of the claim. In addition various parts of the vehicle will not be covered by a Collision Damage Waiver, including the tyres, underbody, wheels and roof.

Theft Protection

Theft Protection covers the theft of your hire car, or damage, but almost always an excess will be applied meaning the first part of any claim remains the responsibility of the person hiring the car.

Supplementary Liability Insurance (SLI)

Supplementary Liability Insurance is a form of car hire insurance that gives consumers third part liability cover. This results in protection against bodily injury and property damage to a third party in the case of an accident, however only up to a specified amount of money.

Excess Insurance

Excess Waiver Insurance for Car Hire is a reimbursement insurance which means that if a policyholder is charged by a car hire company for the excess payable if their hire car is stolen or damaged they can seek reimbursement from the car hire insurer. It provides significant peace of mind for car hirers.

Liability Limits in the US and Canada

The liability limits in the US and Canada are often slightly different to those elsewhere, visit our on third party liability limits in the US and Canada to find out more information.

Personal Accident Insurance

Personal Accident Insurance pays out if you are severely injured or die in an accident in the hired car. Policyholders receive a tax-free lump sum if they are involved in an accident resulting in the loss of one or more limbs, one or both eyes, the loss of use of any of the above, or some other form of permanent disability.


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This content was last reviewed on 24/07/2014