Car hire excess explained: do you need the rental desk's insurance?

You've found a good price on a hire car. Then, at the desk, you're told the excess is over a thousand pounds and offered cover to reduce it, at a daily price that can almost double the cost of the rental. Here is what is going on, and how to decide.

What is the "excess"?

Most hire car prices include basic insurance, but with an excess: the amount you pay towards any damage or theft before the insurance covers the rest. It works like the excess on your car or home insurance, but on hire cars it is often high, and it can apply to minor damage such as a scratched wheel or a chipped windscreen.

When you collect the car, the rental company usually blocks an amount on your credit card as a deposit. If the car comes back damaged, the cost is taken from that deposit, up to the excess.

Option 1: the rental desk's cover

At the desk you'll usually be offered extra cover, with names such as "super collision damage waiver" or "excess reduction". It reduces your excess, sometimes to zero, so there is nothing to pay if the car is damaged.

• The upside: simple, and if something happens you deal with it there and then.
• The downside: it is often expensive per day, and it may still exclude common damage such as tyres, wheels, glass, the roof, the underside of the car and lost keys.

Option 2: standalone excess insurance

You can buy car hire excess insurance separately, before you travel, from a specialist insurer. Instead of reducing the excess, it pays you back if the rental company charges you.

• The upside: usually much cheaper than desk cover, especially for longer rentals or annual policies, and policies often include the tyres, glass and underside that desk cover leaves out.
• The downside: you pay the rental company first and claim it back afterwards, which can leave you out of pocket for a few weeks. The rental company will also keep the full deposit on your card, so you'll need enough credit available.
• Check the small print: age limits are common, and many policies don't cover rentals in your home country.

Before you drive away

1. Photograph and film the car, inside and out, including the wheels and windscreen, and make sure existing damage is marked on the rental form.
2. Check the fuel policy. "Full to full" is usually the fairest: you pick it up full and return it full.
3. Bring a credit card in the main driver's name. Most rental companies need one for the deposit.
4. Do it all again when you return it, ideally with a member of staff signing off the car.

The bottom line

Desk cover buys convenience; standalone cover usually buys the same peace of mind for less, as long as you can cover the deposit and wait for a claim. Whichever you choose, read what is excluded before you buy. This article is general information, not insurance advice. For current offers on the rental itself, see our car hire deals.