When you travel, you may find yourself purchasing several types of insurance, including travel and rental car insurance. But how much overlap is there between these types of insurance? Do you really need both?
Read on to find out what travel insurance and rental car insurance really cover, and how you can be protected on your next holiday.
Key takeaways
- Your travel insurance policy may have limited cover for your rental vehicle, such as your excess.
- However, many aspects of your car rental are likely not covered by your travel insurance. Making a claim through your travel insurance can also involve long waiting periods.
- Rather than relying on your travel insurance as your major form of cover, consider alternatives like RentalCover, or more comprehensive policies from your car hire company.
Does travel insurance cover car rentals?
Some travel insurance policies may include a level of rental car insurance. It may cover elements like your car rental excess.
However, even if your policy includes some cover, it likely has plenty of exclusions for you to be aware of.
What's covered
The following aspects of your rental car may be covered, in part or in full, under your travel insurance policy. This is just a general overview, so make sure to check with your insurance provider before relying on its product.
- Car insurance excess for vehicle damage or theft.
- Vehicle towing.
- Your medical expenses if you get into a car accident.
What's not covered
Your travel insurance policy won't offer comprehensive coverage for your rental vehicle. Here's a summary of what it may exclude:
- Vehicle damage or theft beyond the cost of your excess.
- Any breaches of your rental agreement, such as dangerous or reckless driving, driving on unsealed roads or drink driving.
- Third party liability cover for damage to other vehicles and injuries to other people.
- Unauthorised drivers.
- Certain kinds of vehicles, such as commercial vehicles, campervans, or motorcycles.
How else can you cover a rental car?
If your travel insurer doesn't offer the cover you need to be protected, you have plenty of alternatives to choose from.
Here are some other options you have for covering a hire car.
Rental car companies
Rental car companies have their own car insurance coverage. The most significant aspect is a Collision Damage Waiver (CDW), which transfers liability for damage to a rental vehicle from you to your rental company.
These policies may also include cover for vehicle theft, in which case they may be known as a Loss Damage Waiver (LDW). They are generally automatically included in the base price of your rental vehicle.
The CDW your car rental company offers will typically have many exclusions including tyres, windscreens and underbody damage.
Car rental companies may also offer Super Collision Damage Waivers (SCDWs), which have more comprehensive cover, and generally no excess to pay. However, these policies can be significantly more expensive than alternatives and may still leave you out of pocket for costs such as loss of use.
Hire companies often take advantage of customers not fully considering their options ahead of time, and pressuring them at the rental desk. Make sure to weigh all your available options for car rental insurance before you pick up your vehicle.
Personal auto insurance
It's not common for your personal car insurance to offer substantial cover for rental vehicles. If your policy does, the same coverage limits and excess that apply to your own car will usually also apply to your rental car. So, your cover may not be sufficient if your rental vehicle is more expensive than your daily drive.
Coverage is often even more limited when renting vehicles in other countries.
Your personal auto insurance may extend to covering the following in a rental car:
- Liability cover for injuries and property damage caused in an accident for which you are at fault.
- Damage to a rental vehicle caused by collisions and other covered events.
- Theft of your rental vehicle.
- Some car excess insurance cover.
Credit card coverage
Your credit card may offer coverage for your rental vehicle. However, this cover can include many exclusions or require expensive add-ons. Your credit card could exclude the following:
- Multi-vehicle accidents.
- Fire and theft.
- Vandalism.
- Towing.
- Lockouts.
- Keys.
- Windscreens.
- Headlights.
Credit card insurance is also generally secondary insurance. This means that before you will be reimbursed for the costs you're covered for, you must first file a claim with primary insurance that you hold.
This can become a complex administrative process, and you could be left out-of-pocket for an extended time.
RentalCover
RentalCover offers protection for your rental vehicle that's more affordable and more comprehensive than the alternatives. Our policies bolster your rental company's coverage, so you don't need to worry about relying on the limited protection from your credit card or travel insurer.
Our cover is 50% cheaper than rental companies†, and there's no excess for you to pay when things go wrong. We cover the common exclusions of other insurers, including underbody damage, tyres and much more.
We make claims easy with a simple online process you can complete in more than 40 languages. Typically, we process claims within 5-7 business days.
Tips for hiring a car abroad
Here are a few top rental vehicle tips for a seamless experience hiring a car overseas:
- License and International Driving Permit: Ensure your license covers you for the vehicle you rent in the country you travel to. You may also need an International Driving Permit.
- Fuel costs: Make sure you understand your rental company's fuel policy. You may pre-pay for fuel, or you may be required to return your vehicle with a full tank. Not following this policy could result in significant, unnecessary costs.
- Car rental insurance: Make sure to carefully research your options for rental car insurance. Purchasing a RentalCover policy in advance can help you save considerably. Also, remember that rules around rental car insurance may be different when travelling to other countries. For more information, check out our complete international car rental guide.
Get full rental vehicle protection with RentalCover
To enjoy your holiday with true peace of mind, rely on RentalCover. Our cover is more comprehensive and up to 50% cheaper than the alternatives.†
With RentalCover, there's nothing for you to pay in the event of a claim. And, you're covered for the items travel insurers and rental companies commonly exclude from their policies, including underbody damage, towing costs and much more.
Rely on our specialist, expert cover for your next holiday.
Frequently asked questions
How do I tell if my travel insurance will cover my rental car?
Refer to your Certificate of Insurance or Product Disclosure Statement to understand what your travel insurer covers. If you require clarification in any area, make sure to reach out to your travel insurer and confirm exactly what you're covered for.
Do you need additional insurance when renting a car?
Outside of Canada and the United States, the minimum level of third party liability insurance you need to legally hit the road is almost always included in the price of your rental vehicle. You'll generally also have a basic level of cover through a built-in CDW.
Beyond these policies, you may want extra cover for common CDW exclusions or your excess. This is where options like RentalCover can be extremely valuable. Our cover is 50% cheaper than rental companies†, with nothing for you to pay in the event of a claim.
How can I get cheaper rental car insurance?
The most important step for getting cheaper rental car insurance is to carefully consider your available options. Weigh up alternatives to rental company cover, like RentalCover, ahead of time. Don't wait until you're standing at the rental desk, where you can be pressured into purchasing cover that doesn't offer the best value.
What should I do in the event of an incident in a rental car?
Here's the process to follow when you get into an accident in a rental vehicle:
- Check for injuries among all affected parties. If anyone is hurt, contact emergency services immediately. Move to a safe location if possible.
- Report accidents involving death, injury or significant property damage to the police. For non-emergencies, contact a local police station rather than the emergency number.
- Take comprehensive photos and/or videos of all vehicles, damage, road conditions and the accident location. You should also collect the names and contact details of any witnesses.
- Exchange driver details, vehicle registration, insurance information and contact details with the other party. Make sure not to admit fault while doing this.
- Notify your rental company of the incident as soon as possible. They will guide you through their process and may arrange a replacement vehicle.
- Settle your charges with your rental company, making any appropriate payments. Once this is complete, you can submit a claim through your online account if you have a RentalCover policy. Typically, we process claims within 5-7 business days.
Does Allianz travel insurance cover car rental?
Various Allianz travel insurance policies around the world may offer cover for your rental vehicle. Refer to the Product Disclosure Statement and your Certificate of Insurance for a full picture of what your policy includes.