How Car Hire Insurance Claims Work

Here’s a few more car hire insurance related points to note.

If you damage your rental car, you can expect the car rental company to automatically deduct the MAXIMUM amount you are liable for (e.g. something like $2,750 if you haven’t taken out excess reduction) from the credit card you’ve registered with them. After evaluating the damages and if they ultimately amount to less than that, only then will they reimburse you for the difference. This can take time. Meanwhile, know that you’ll find yourself with a full excess charge sitting on your credit card.

This is the same if you’ve taken out third party car hire insurance. The car hire company will dutifully carry out the deduction as explained above, after which you’ll need to go through the process of making a claim from your insurance provider. As with all insurance claims, you can expect this to take several weeks before you’ll be reimbursed.

Bottomline is, even if you have insurance, if you do end up damaging your rental car, be aware you’ll probably be a little “extra poorer” for some time.

There are various clauses in car rental contracts which explain what they deem a “breach of contract”. This could include driving on unsealed roads, on beaches, in the snow, drunk, or simply to certain off-limit locations like Kangaroo Island or Bruny Island.

If you do any of these things, your entire contract could be considered void. This means you may no longer be protected by any insurance as originally stated in your agreement. The cap on your damage liability may be nullified and you could potentially be charged up to the cost of the entire car if you end up in an accident anytime during the rest of your trip (i.e. even if it didn’t occur during your contract-breaching escapade). And you won’t be able to claim a dime.

So inform yourself on what they consider a breach, don’t do it and you’ll be fine.

• Immediately inform your car hire company of the accident. Check with them (and your car hire insurance company, where applicable) for their specific procedures and requirements
• Ensure you record the name and address of the individuals involved (i.e. driver and owner of the vehicles), as well as the registration plates and licence details
• Get details of any witnesses who can testify as to what happened
• If possible, take photos of the scene as further documentation
• Notify the local police and obtain a signed police report