Rental Cars and Insurance
November 8, 2017
Are Rental Cars worth it with their Insurance Issues?
- Only if you sort out your own insurance. You may find with their basic insurance you do not have cover for pothole damage
- Rental cars are expensive and vehicle insurance is just as expensive with insurance policies having a host of conditions because of the high risks with unlicensed road usage
- Car rental companies offer optional waivers – Collision Damage Waiver (CDW) and Super Collision Damage Waiver (SCDW). Declining them means you’ll be legally responsible for the full amount of damages.
- These sorts of policies don’t provide you with all the cover you need
- If the vehicle is damaged or stolen, the renter is nearly always liable for the first portion of the loss. This is known as the ‘excess’.
The excitement of solving your transport problems with a rental car may soon turn to frustration when you start combing through the fine print of the insurance coverage options offered by rental companies. Some of the major car rental companies in South Africa are:
- Tempest Car Hire
- Imperial Car Rental and
It’s not Rental Car Insurance but Responsibility Waivers
These car hire companies don’t offer insurance, but rather responsibility waivers. The reason they don’t offer insurance as part of the deal is because they aren’t officially financial service providers. The waivers however function in the same way.
These responsibility waivers are legal agreements to limit the claim for damage or loss to the vehicle. These waivers differ from car hire companies so check with the rental agent what your cover entails. Certainly, irritating though it may be, take the time to read the terms and conditions of the rental agreement.
If you were in a crash, you’d be responsible for a specific amount according to how it stands in the rental agreement.
It is always wise to review the different companies before you make a car reservation.
You’ll find that most of the car rental rates from these insurers includes fire and third party liability insurance. Most times you’ll find that their rates also come with collision and theft coverage.
Ways to Insure a Rental Cars
- Your insurance policy. You might be able to cover your rental vehicle without having to alter anything on your policy. Most insurance companies are prepared to extend liability coverage to your rental car from your personal policy. Some may be willing to transfer physical damage coverage as well, so long as you have it on another vehicle on the policy. It is important to check with your insurance company to check out the specifics of what your policy will actually cover with rental vehicles.
- Your credit card. Some credit cards will offer coverage to any rental vehicle. Take note though that the limits of liability may be somewhat lower than a standard insurance policy.
- Responsibility waiver with the rental car company
When you start doing research on car rentals in South Africa you’ll see that as mentioned, car hire companies don’t offer insurance, but waivers. Don’t be under the illusion that you’re getting insurance that covers you for everything, because you’re not.
Get Additional Insurance
Yes, when renting a car, make sure that your rental agreement includes a basic level of waivers. This will at least make sure you have sufficient cover in the event of an accident or theft.
Read the fine print on the car hire rental agreement terms and conditions so that you understand liability, and how to benefit buy purchasing your own additional insurance.
This is because with waivers, if you’re involved in an accident, you’ll be responsible for a certain amount as laid out within the rental agreement, and this can be a large amount that is out of your realm.
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All info was correct at time of publishing