A new survey by car hire company Europcar has found that many rental car drivers underestimate the risk of damage – however accidental – to their rental car.
Europcar found that nearly 90% of its UK rental fleet suffered some form of damage – from major bodywork damage to flat tyres and windscreen chips and cracks – during 2010.
Despite this, only just over 30% of customers opted for the additional Risk Reduction Cover, which reduces the insurance excess payable by rental customers if the car is damaged during their hire.
It is important to remember that although some types of damage – like windscreen chips and flat tyres – cannot realistically be completely avoided, you, as the rental driver, will still be liable for the cost of repairing them.
Ken McCall, Managing Director at Europcar, explains the situation like this:
If a motorist is driving their own car and has a windscreen chip or a small dink or dent in the car’s bodywork, they can choose to ignore it. Car hire companies simply cannot do that. The next customer will expect a pristine car, so we must ensure damage is repaired as quickly as possible and that means we must recover the cost. That’s why it makes so much sense for consumers to take out insurance for damage they may incur, including cover to reduce the excess to zero.
While car hire companies do have a reputation for overcharging on the cost of repairing damage, McCall’s point is valid – not only do car hire customers expect the car to be in good condition, but car hire companies’ business models depend on achieving good resale value for their ex-rental cars when they sell them on.
Reducing Your Car Hire Excess
Most car hire companies allow you to reduce this by paying an additional daily fee. Different companies use different names for this, but it is essentially an insurance product that reduces your excess to a low amount or zero.
Europcar offers two products in this area – Risk Reduction Cover, which reduces the excess to zero and includes on additional driver, and Value Cover, which reduces the excess to zero for the most commonly damaged parts of a hire car – tyres, windscreen and glass.
An alternative that makes good sense, especially for regular car hire users, is to purchase additional car hire excess insurance from a third party. You can then claim on this if you have to make an excess payment to your hire company.
One of the best products on the market is iCarHireInsurance, which offers both daily and annual policy options and can provide cover for car hire all over the world. It is usually cheaper to buy separate car hire excess insurance than it is to buy car hire excess insurance directly from hire companies.