Am I insured to drive a hire car?

Reading through the T&Cs of a rental hire document can be overwhelming, especially when trying to figure out the rules of what you can and can’t do.

However, understanding the insurance coverage for your upcoming rental and whether you need to purchase additional protection will make sure you’re fully covered on the road.

Keep reading to explore the various types of insurance options available, what’s typically included, and whether your existing policy or credit card may provide coverage.

What insurance is included with a hire car?

Most car hire companies include basic insurance as part of their rental agreements, which typically covers third-party liability. This means that if you’re involved in an accident and cause damage to another vehicle or property, the insurance will cover the costs.

However, it’s essential to note that this basic coverage may not include damage to the hire car itself or cover any injuries you might sustain.

In addition to third-party liability, car rental companies often offer optional insurance upgrades for added protection. These typically include:

1. Collision Damage Waiver (CDW) – A CDW reduces the amount you’d have to pay if the rental car is damaged. Without a CDW, you could be responsible for the full cost of repairs. However, even with a CDW, there’s usually an excess (the amount you’re responsible for paying) in case of damage.
2. Theft Protection – This protects you from financial loss if the rental vehicle is stolen. Again, like CDW, it often comes with an excess.
3. Personal Accident Insurance (PAI) – This covers medical expenses for you and your passengers if you’re injured in an accident while driving the hire car.

Are you covered by your personal car insurance?

Before renting a car, it’s worth checking whether your personal car insurance policy extends to rental vehicles.

Many comprehensive car insurance policies offer some level of coverage for rental cars, but it’s crucial to clarify with your insurance provider.