Domestic car hire excess insurance

[Jleno]

Hi - I was wondering if anyone has used Worldwide Insure or iCarHireInsurance (which I think are UK based companies) to purchase car rental excess insurance? This is to avoid paying ridiculous daily insurance excess rates offered by the car rental companies.

The only other options would be credit cards which have specific car rental cover options - such as ANZ and Westpac - but I'm not too keen on yet more credit cards (with high annual fees) just for car rental purposes.

I will be hiring cars regularly in Australia and am looking for a way to reduce the excess without paying silly prices that car rental companies are asking.

 

[Moopere]

Hi - I was wondering if anyone has used Worldwide Insure or iCarHireInsurance (which I think are UK based companies) to purchase car rental excess insurance? This is to avoid paying ridiculous daily insurance excess rates offered by the car rental companies.

The only other options would be credit cards which have specific car rental cover options - such as ANZ and Westpac - but I'm not too keen on yet more credit cards (with high annual fees) just for car rental purposes.

I will be hiring cars regularly in Australia and am looking for a way to reduce the excess without paying silly prices that car rental companies are asking.

If you are doing a lot of hires, and its primarily work related, talk to your hire company about arranging a Company Discount Program (CDP). The benefits will vary company to company and agreement to agreement, but in general the excess is capped to 500-700$ or a bit more.

If its private hires, be extremely cautious of the credit card style hire car excess insurance. Many are capped at 3000-4000$ with only a few going as high as 5000$. Depending on car and accident circumstance some hire companies, Hertz for example, can slug you for $9900 in excess for a single accident in standard sedans (and don't even talk to me about 4wd), which is well outside your CC provided insurance levels.

As far as O/S insurance companies covering you here. Well, I'd have thought that the nature of travel style insurance would be to cover customers when they are overseas, however, be cautious of the T&C, some may explicitly list your home country or where the start of a journey must occur ... or other exclusions. I'd get something in writing from them covering your specific circumstances.

 

[Jleno]

It will be mainly for private hires (since I don't have a car).

I thought the maximum excess for standard vehicles with the major car companies like Hertz and Avis is around $3-4K. I'm curious about where you read that Hertz could charge you $9900?

I have read the overseas insurance companies' Ts&Cs in detail (and actually, their Ts and Cs are no where near as detailed as one might have expected) and it all seems fine to cover an Australian renting in Australia. Problem however, and this applies to any insurance, is that you really don't know how good an insurance product is until you need to claim - and by then it's all too late.

 

[Moopere]

I thought the maximum excess for standard vehicles with the major car companies like Hertz and Avis is around $3-4K. I'm curious about where you read that Hertz could charge you $9900?

You will no doubt have noticed in recent years the hire companies breaking down their insurance offering into partial cover, specific instance cover, super cover, super duper cover, etc, etc. We now have to be extremely careful of additive clauses in the rental agreements. Single vehicle accidents, involving water and say a tyre blowout can see multiple excess amounts adding to each other. I don't have the Hertz PDS in front of me, but have a serious read of some of these refreshed agreements, they can be quite frightening.

 

[AdMEL]

Hertz has a non waivable excess of $9,900 on unsealed roads in Tassie. Hertz excess for Mercs is $5,500 + 3.5% admin fee + airport surcharge (up to 25%), so excess can easily be $7,000! And that's for an accident involving another car - if no other car is involved, add $2,200 + admin fee + airport fee, so you be up for $10,000! Same fee structure for 4WD's. Other rental car companies are less, as they don't have an additonal single vehicle accident excess. Rental cars in NT and WA have very high excesses too.

In the case of driving on unsealed roads, Hertz provides no cover (but does not prohibit it), Europcar and Thrifty prohibit it, so you could be up for even more!

I rely of both Westpac and ANZ cards for my excess cover. Westpac covers myself only for $5,500 ($295 annual fee for Altitude, but can be as low as $130 for standard Plat) and ANZ covers myself and any additonal drivers for $2,050 ($24 p.a. on any card), although is not useful for Hertz, as it provides no cover if the rental car company charges an additional single vehicle accident excess. Note that for Platinum card holders, ANZ now covers $5,000. I think you'll find that the card fees might not be that much higher than the annual policy you're talking about and the risk would be lower, as you're dealing with an Aussie insurer.

 

[markis10]

Hertz has a non waivable excess of $9,900 on unsealed roads in Tassie. Hertz excess for Mercs is $5,500 + 3.5% admin fee + airport surcharge (up to 25%), so excess can easily be $7,000! And that's for an accident involving another car - if no other car is involved, add $2,200 + admin fee + airport fee, so you be up for $10,000! Same fee structure for 4WD's. Other rental car companies are less, as they don't have an additonal single vehicle accident excess. Rental cars in NT and WA have very high excesses too.

In the case of driving on unsealed roads, Hertz provides no cover (but does not prohibit it), Europcar and Thrifty prohibit it, so you could be up for even more!

I rely of both Westpac and ANZ cards for my excess cover. Westpac covers myself only for $5,500 ($295 annual fee for Altitude, but can be as low as $130 for standard Plat) and ANZ covers myself and any additonal drivers for $2,050 ($24 p.a. on any card), although is not useful for Hertz, as it provides no cover if the rental car company charges an additional single vehicle accident excess. Note that for Platinum card holders, ANZ now covers $5,000. I think you'll find that the card fees might not be that much higher than the annual policy you're talking about and the risk would be lower, as you're dealing with an Aussie insurer.

Thrifty also have SVA at the same rate as hertz! Europcars excess is also payable regardless of fault although this has been challenged and overturned at times.

 

[Jleno]

Thanks for that AdMel. Just been doing a bit of research myself. Looking specifically at an Avis contract, as well as a domestic annual travel insurance with CoverMore that covers up to $4000 of excess.

At the moment, it seems that there is a gap for damage done to 3rd party personal and property (ie hitting another car). If you don't take excess reduction with Avis, then you'll have to pay, up to $3,020, for damage to the Car and "property of any third party which is caused by [you]". This is assuming that you're not sued personally by the third party. In the usual case, presumably the third party will get the details of Avis and get their insurance company to follow it up with Avis and Avis will then come after you for up to the $3,020 excess.

Looking at CoverMore's annual domestic travel insurance with $4,000 excess cover ($84 for the annual policy), it covers "any Rental Car insurance excess You become liable to pay as a result of damage to, or theft of, a Rental Car, whilst in Your control during the Journey".

So a third party property damage (ie the car you hit) would be claimed by Avis up to the excess, but potentially the travel insurance would not cover it because it is not "as a result of damage to, or theft of, a Rental Car". Yes you could argue that you wouldn't damage the third party car unless you also damaged the Rental Car (unless we're talking about your rental truck towbar reversing into a ferrari bumper for eg), but I'm still not sure whether third party property would be covered under the travel insurance.

As for unsealed roads, the travel insurance specifically excludes it, so you're liable anyway (and I suspect the same would apply under the credit card cover). Or if its not specifically mentioned, it's probably a breach of the car rental agreement, which means that any car rental excess insurance would also exclude cover on this basis.

 

[Moopere]

At the moment, it seems that there is a gap for damage done to 3rd party personal and property (ie hitting another car). If you don't take excess reduction with Avis, then you'll have to pay, up to $3,020, for damage to the Car and "property of any third party which is caused by [you]". This is assuming that you're not sued personally by the third party. In the usual case, presumably the third party will get the details of Avis and get their insurance company to follow it up with Avis and Avis will then come after you for up to the $3,020 excess.

So a third party property damage (ie the car you hit) would be claimed by Avis up to the excess, but potentially the travel insurance would not cover it because it is not "as a result of damage to, or theft of, a Rental Car". Yes you could argue that you wouldn't damage the third party car unless you also damaged the Rental Car (unless we're talking about your rental truck towbar reversing into a ferrari bumper for eg), but I'm still not sure whether third party property would be covered under the travel insurance.

I'm not sure. I had formed the impression that all rentals in Australia were required to have comprehensive insurance ... if this is correct then I'd assume that 3rd party damage would be entirely covered by said insurance unless breaking the law or (potentially) breaking the rental agreement.

What comes into question is the size of the excess payable against this insurance. The various 'optional/extra' insurance offered by the car hire companies here is really further insurance against insurance excess.

 

[Jleno]

Moopere - I think you're right in that car rental companies will probably cover third party person and property - then they push this only the renter through the excess amount. The question then goes to whether any third party excess cover one gets (either through separate travel insurance or through insurance as part of their credit card benefits) covers the rental companies' excess for damage to third party person and property.

 

[AdMEL]

Thrifty also have SVA at the same rate as hertz! Europcars excess is also payable regardless of fault although this has been challenged and overturned at times.

I was told by Thrifty at SYD last week that they had abolished SVA. This contradicts their website (which I mentioned), but in any event, according to the website, SVA does not apply in metro areas anyway, only outside of metro areas.

My understanding was thatthe way the rental agreements are worded for all rental car companies, they all charge the excess regardless of fault. In practice, some may charge it but may refund it at a later date, or some may not charge it at all if not your fault, but they all have to the right to charge and keep it.

 

[markis10]

I was told by Thrifty at SYD last week that they had abolished SVA. This contradicts their website (which I mentioned), but in any event, according to the website, SVA does not apply in metro areas anyway, only outside of metro areas.

My understanding was thatthe way the rental agreements are worded for all rental car companies, they all charge the excess regardless of fault. In practice, some may charge it but may refund it at a later date, or some may not charge it at all if not your fault, but they all have to the right to charge and keep it.

Not quite correct, SVA is still applicable to commercials and 4WDs regardless of the area it's operated in, go on you NRMA!

 

[JohnK]

Any of the local travel insurance providers should include $4,000-$5,000 car hire excess and some even include the option to purchase higher cover.

I have used Travel Insurance Direct, QBE, Online Travel Insurance and mainly purchase yearly policies. The current QBE policy was <$200/pa but only includes 72 hours per trip in North America otherwise the premium is >$300.

 

[Philip Suter]

You are quite correct Worlwideinsure and iCarhireinsure are both British insurance companies offering car hire insurance. I have personally used iCarhireinsurance recently in Britain and Ireland for a van hire policy and bought mine through ad on the insurance4carrental.com site. They have a specialist page about car hire excess companies who cover nationals from around the world and the countries they will cover etc. Good luck with your search

 

[lovestotravel]

Hertz has a non waivable excess of $9,900 on unsealed roads in Tassie. Hertz excess for Mercs is $5,500 + 3.5% admin fee + airport surcharge (up to 25%), so excess can easily be $7,000! And that's for an accident involving another car - if no other car is involved, add $2,200 + admin fee + airport fee, so you be up for $10,000! Same fee structure for 4WD's. Other rental car companies are less, as they don't have an additonal single vehicle accident excess. Rental cars in NT and WA have very high excesses too.

Wow that one has missed my eye before!

 

[lovestotravel]

Where does it say that Hertz will charge the 25% airport surcharge on the excess ???

"If you return a Prestige or Fun vehicle in a damaged state, generally speaking, you will be liable for the cost of repair of the damage (plus the cost of repairing damage to any other vehicle or property with which the rental vehicle collided) up to the amount of the Accident Damages Excess (ADE), which is a maximum of AUD $5500.00 (inclusive of GST)."

 

[markis10]

Where does it say that Hertz will charge the 25% airport surcharge on the excess ???

"If you return a Prestige or Fun vehicle in a damaged state, generally speaking, you will be liable for the cost of repair of the damage (plus the cost of repairing damage to any other vehicle or property with which the rental vehicle collided) up to the amount of the Accident Damages Excess (ADE), which is a maximum of AUD $5500.00 (inclusive of GST)."

The excess is added to your RA and location surcharges are applicable to the TOTAL cost of your rental, I had it happen a few years back.

 

[dougieboy]

If you do have an accident and rely upon your credit card provider to provide vehicle excess reducation cover, companies such as Hertz will still dock your credit the excess rate depending upon the class of vehicle you hired, and it's up to you to chase it up with your credit card company. $35 a day for peace of mind comprehensive insurance is worth it in my opinion. Otherwise it's the shuttle bus for you!

 

[AdMEL]

Not quite correct, SVA is still applicable to commercials and 4WDs regardless of the area it's operated in, go on you NRMA!

I was referring to cars, but I should have clarified!

Where does it say that Hertz will charge the 25% airport surcharge on the excess ???

"If you return a Prestige or Fun vehicle in a damaged state, generally speaking, you will be liable for the cost of repair of the damage (plus the cost of repairing damage to any other vehicle or property with which the rental vehicle collided) up to the amount of the Accident Damages Excess (ADE), which is a maximum of AUD $5500.00 (inclusive of GST)."

It doesn't! Nor does it say that the 3.5% admin fee applies to the excess as well! That's one of the biggest annoyances with all of the rental car companies - their lack of disclosure! Even if you ring them and ask, they don't tell you the correct amount! They quote the $5,500 and only quote the actual amount when queried/pushed! Very annoying! I've had many an argument with rental car company staff about quoting me the incorrect excess amount! I now ask what the actual amount that will be charged to my credit card to get my point across! When I rang Thrifty about a Caprice res for this weekend in SYD, they couldn't even tell me!

 

[Jleno]

I won't have to worry too much about "Prestige" or "Fun" categories - have you seen the models on offer in Australia? Laughable. US and Europe Hertz/Avis however, is a different story - some seriously nice cars in their collection! I wonder why they don't offer nicer models (eg Hertz used to have the Z4 available for hire a few years ago) - maybe it's because they get thrashed too much in Australia, or maybe because Australia's far too expensive for anyone to hire these cars.

As for getting the right information out of rental staff - good luck. Most of them have no idea, even if you were to read the contract together with them, chances are you'll be able to interpret them more correctly than they will! It's like everything else in Australia, customer is usually wrong when there's a dispute.

 

[lovestotravel]

I won't have to worry too much about "Prestige" or "Fun" categories - have you seen the models on offer in Australia? Laughable. US and Europe Hertz/Avis however, is a different story - some seriously nice cars in their collection! I wonder why they don't offer nicer models (eg Hertz used to have the Z4 available for hire a few years ago) - maybe it's because they get thrashed too much in Australia, or maybe because Australia's far too expensive for anyone to hire these cars.

As for getting the right information out of rental staff - good luck. Most of them have no idea, even if you were to read the contract together with them, chances are you'll be able to interpret them more correctly than they will! It's like everything else in Australia, customer is usually wrong when there's a dispute.

Well the A4, A6 and C200 are not that bad cars really, we are "lucky" there is anything nice to rent!

As for nicer models here, it's the cost of the cars to purchase here that is the problem.... EG $60k for a Merc GL450 in the USA or $180k here

The cost for the rental would be far too high for most people, so they would never get rented

The contracts, especially with Europcar, are a nightmare! I have had one rental with them but even though I have a very good deal on the Audi's I am tempted to cancel the rest of the bookings as I don't like the contract/liability/T&C's