Car hire companies aren’t evil. Many of us simply don’t bother to read the contract. Sure, we’ve all heard of hire car horror stories in the media, like the couple from the UK who were charged $3,044 for non-existent damages. The fact of the matter is that car hire companies plainly outline their fees, and any tales you hear are usually exceptions.
When hiring a car, most of us worry that we’ll have to pay an obscene amount of excess in the event of a crash or theft. So we take the hire car company’s offer to reduce our excess and pay a little extra for the privilege.
But if you took out travel insurance for your trip, we’ve got a surprise for you: you may have overspent on your hired car costs.
How travel cover saves you from an expensive excess
Excess is the amount you pay when you need to claim on your hire car insurance (e.g. in the event of a crash). The excess can cost several hundred dollars, but you can reduce it by paying more each day in hiring fees.
However, some travel insurance policies cover rental car excesses. So if you’re protected by travel cover, you may not need to pay extra in daily hire car fees to reduce this excess! Therefore, you could save money on your hire car rental costs.
Typically, this cover is a feature of comprehensive policies. With the right cover, you can claim if
- you crash the rental car; or
- the car is damaged or stolen
…provided you meet certain criteria. For example, you must be covered by the hire car company’s insurance policy to qualify.
What could stop me from claiming?
There is a limit to your excess cover. For example, one insurer we checked had a limit of $6,000, while others had less than $3,000. You’ll need to check with your prospective insurer before you take out cover.
You need to watch out for any exclusions that would preclude you from claiming. You may not be covered if:
- You break local driving laws.
- You breached the terms of your Vehicle Rental Agreement.
- You did not hire a car from a licensed company.
- You damage the car driving off-road.
- The driver wasn’t covered by the insurance policy.
- You’re liable for causing bodily injury or death of another person.
- You were driving under the influence of drugs or alcohol.
- You did not hold a license for the vehicle you were using.
What rental car costs do you need to look out for?
When hiring a car, you’ll have to fork out cash for the following:
- Basic rate (including road tolls and admin fees) per kilometre driven
- Additional driver surcharges
- Young driver surcharge
- Probationary driver surcharge
You may also opt for the following, at your expense:
- GPS device rental
- Baby seat rental
- Roadside assistance
Finally, there could be any number of hidden fees waiting when you return your car.
- Refuelling fees (calculated at several dollars per litre until the tank is full)
- Traffic infringement administration costs (e.g. the rental car company receives your parking tickets)
- Credit card fees
- Flat tyre fees
- Breakdown fees
N.B. The above does not constitute an exhaustive list of everything you can be charged for when hiring a car.
Be on the lookout for hire car savings
8 ways to save on car rentals that you didn’t know about
So, how can you save some cash when renting out a car for your next trip? Keep these following tips in mind next time you’re planning a getaway.
- Be wary of airport pickups. After a long flight, most of us just want a simple transportation option for our trip. Be careful when hiring at airports, because you may be paying a premium for pickup from this location. You can save money by getting on a train or bus and hiring your car from a second location.
- Book your rental car in advance to potentially secure a better deal. A few weeks before heading on your holiday, compare different rental costs. You can even do this a few months before heading off. You’ll be surprised with deals you might find.
- Bring your own extras. Most of us will have GPS (through our smartphones) or a baby seat. Why rent alternatives when you can just bring your own?
- Choose fuel-efficient vehicles. Depending on your agreement, you might have to return your car with a full tank of petrol. If this is the case, you’re going to save cash if you’re driving a smaller vehicle.
- Ensure the vehicle is signed in before leaving. This way, ‘mystery dents’ won’t be charged to your credit card. As an extra precaution, take photos of the car before you drop it off so you have proof of its condition before you leave.
- See if your credit card company offers special deals for hiring cars, or if you qualify for a corporate deal through your work.
- Stick to one driver. Adding drivers can bump up the price. Organise for one person to be chauffeur throughout the trip.
- Try to return the car from where you picked it up. Otherwise, you might have to pay a relocation fee.
Make sure your travel insurance covers hire car costs by tracking down comprehensive cover.