"road Trip Coverage: Car Rental And Roadside Assistance In Australian Travel Insurance"
"road Trip Coverage: Car Rental And Roadside Assistance In Australian Travel Insurance" - Money driving a rental car abroad - should you risk not getting comprehensive car rental insurance cover? Are you paying extra for insurance you don't need when you get comprehensive car rental insurance? Timothy Ho, August 30, 2018
Here's a simple question that travelers who regularly rent and drive a car abroad should consider beforehand.
"road Trip Coverage: Car Rental And Roadside Assistance In Australian Travel Insurance"
When asked by a rental car employee if you would like to upgrade your insurance coverage for a "small" fee to enjoy comprehensive rental car insurance coverage, should your answer be "yes" or "no"?
Rental Car Insurance
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Before you understand how rental car companies make a profit from the insurance policies they sell, you must first understand how rental car excess works.
When you are abroad and you rent a car, the car has some basic insurance. As a renter, you usually have to pay the excess of the car rental.
For example, if the car rental excess is $3,000, that means you are responsible for paying up to $3,000 of potential damage to the car.
Rental Car Reimbursement Vs. Rental Car Coverage
It's equally important to note that unlike owning and driving a car in Singapore, where we can sometimes reasonably expect to pay nothing if we're not at fault for the damage (eg being hit by another car and caught on camera), most cars rental companies could have contracts that specifically state that the renter is responsible for paying for damages even if the accident was not their fault.
This provision is included for practical reasons. A car rental company cannot or should not want to initiate a lengthy investigation every time minor damage is found on one of its vehicles.
As a traveler enjoying a holiday in a foreign country, the last thing most Singaporeans want to ruin their vacation is being responsible for a $3,000 repair bill.
When you are driving in a foreign country, many things can go wrong. For starters, in many countries you won't know the road you're driving on, the road conditions are very different from what we're used to in Singapore.
Will Your Personal Car Insurance Cover A Rental Car?
Also, unlike Singapore, many countries, even developed ones, are not as safe compared to Singapore, which also applies to your vehicle. Driving a rental car is also more likely to commit a crime. Just a smack on the windshield while you're parked and away from your car is all it takes to be responsible for a hefty bill.
For added peace of mind, most car hire companies will offer comprehensive insurance, at a premium of course. This will cover any liability that may arise from damage to the car. Additional insurance premiums are usually charged daily (eg S$30 per day). If you rent a car for eight days, you might pay about S$240 more. This could easily increase your total car rental costs by 30-40%.
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Apart from opting for comprehensive car rental insurance, another area that Singaporean travelers can rely on is simply purchasing a good personal travel insurance policy.
Take Rental Car Insurance Out With Hansemerkur Online
A travel insurance policy would cover you in various areas such as medical emergencies, disruption of travel plans, flight delays, loss of belongings, theft and yes, even car rental excess.
For example, Income provides an excess of up to $2,500 under its preferred plan. If you opt for their Classic plan, coverage is up to $1,500.
In other words, if you incur an excess of $1,000 in damage from your rental car, the Classic plan will cover the costs that must be paid. If you want a higher level of protection, you can opt for the Priority plan, which covers you up to $2,500.
This could be a better (and cheaper) alternative than paying extra for comprehensive car rental insurance. In addition, you also have other personal travel insurances.
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But this seemingly logical view leads to two major misconceptions. The first is to never opt for comprehensive car rental insurance. The second is that if you choose comprehensive rental car coverage for any reason, you are at risk for anything that happens to the car. Both views are not entirely accurate.
To help us answer these questions, we spoke to Mr. Jimmy Tan, CTO at the General Insurance Association (GIA) in Singapore.
(DNS): Additional premiums to reduce excess cars are notoriously expensive. At the same time, some Singaporeans may not be aware that their travel insurance plans include an optional rental car cover.
Is this a good reason for drivers planning to hire a car overseas to buy a higher level of cover so they can enjoy more excess hire cover which includes extra cover in other areas as opposed to paying multiple hire companies cars cut surplus?
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Jimmy Tan (JT): Many travel insurance policies include rental car excess coverage, either as part of the policy benefit or as optional coverage. However, there is usually a coverage limit depending on the travel insurance plan and it can range from $500 to over $1,000.
On the other hand, the excess for a rental car can be more than $3,000. In the event of an accident, the insured may be liable to pay the excess for the rental car.
Before deciding whether to purchase the full rental car excess to reduce the difference, check the typical excess that applies to the destination and the car rental excess limit of your travel insurance plan. Applicable additional premiums usually depend on the amount of the excess.
DNS: Does excess car rental mean that the driver is completely free of all obligations? What are certain scenarios where drivers are still liable for damages even though they have already reduced their rental car excess to zero?
Should I Get Rental Car Insurance? A Guide To Making An Informed Decision
JT: Car rental commission only provides coverage for the commission if the insured is liable to pay the rental car agency for damage to the rental car and the insured complies with the terms of the car rental lunch insurance and the car rental agreement. If policies do not cover a claim, for example in situations such as drink-driving or an unregistered driver, the insured will have to pay for it. Or if the insured has breached the terms of the policy under the rental car excess, the excess will not be covered.
Jimmy also shared with us some additional tips that Singaporean drivers should look out for and consider when renting a vehicle abroad.
#2 Check what your travel insurance covers – most travel insurance policies offer optional Rental Car Excess cover.
# 3 Only named drivers or passengers should drive the car – Rental Car Excess coverage only applies to drivers who are registered at the time of rental. Damage caused while driving by other persons is not reimbursed.
Car Rental Safety Tips That You Should Know About
#4 Confirm the terms of the rental – most policies only cover cars, but exclude motorcycle coverage. Read the contract carefully before you leave the rental office and make sure you check the extras.
#5 Submission and approval of your claims – You may need to submit copies of evidence to have your car rental excess claim approved, such as your vehicle rental agreement, incident invoice, itemized repair invoice and written notice from the rental company of the excess. which you have to pay.
#6 Credit Card Limit – Always ensure your credit card limit covers the excess you owe the rental company as it may be charged for prepayment. In the event of an accident, you will need to file a claim with your travel insurance company for reimbursement.
#7 Rental Vehicle Return – Some policies cover returning the rental vehicle to the nearest depot if you are hospitalized and unable to return the vehicle in person.
Driving A Rental Car Overseas
# 8 Car rental add-on options – Keep in mind that replacement and repair costs may vary by make and model. For example, the premium for luxury vehicles or four-wheel drive vehicles is higher than for regular sedans.
# 9 Car Insurance Policy – Passengers must purchase comprehensive car insurance for the rental vehicle during the car rental period and comply with all conditions set out in the car comprehensive insurance policy.
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