Car hire excess insurance: Buy before you fly to save a fortune

3 min Read Published: 15 Jun 2022

money saving tip car hire abroad

So you've spent an age finding and booking a good deal on a holiday rental car for your upcoming holiday. You receive your email confirmation and look forward to your time in the sun.

Now fast forward to the airport arrivals terminal on the first day of your holiday. You start going through the paperwork with the car hire company before you can get your sweaty palms on the car keys. But that's when the hire company drops the excess waiver bombshell. They tell you that should you crash or damage the car you would be liable for a sizeable excess, typically around £600.

They then hit you with a pressure sale of their excess waiver policy which ensures that in the event of an accident you will not have to pay any excess at all, as long as you take out the policy. You are about to drive on the wrong side of the road on routes you don't know so are understandably nervous that the chances of an accident are higher. The catch with these policies is that they're not cheap.

I stayed in a town near Alicante so I will give you a real-life example to highlight my point.

  • The basic cost of my car hire was £220 for 8 days rental.
  • I was then told the excess I would have to pay if I didn’t take out an excess waiver policy would be around £550.
  • The cost of the excess policy would be approximately £20 a day (I’ve converted this from Euros) bringing the total cost of the policy to £160
  • So if I had taken out the policy (which I didn't) my total car hire would have jumped from £220 to £380!!!!

How can I save money hiring a car for my holiday?

Most people are unaware that it is possible to take out a cheaper excess waiver policy in the UK before you go. These policies not only work out cheaper but will ensure that you aren't liable for the hire car company's excess in the event of an accident.

icarhireinsurance is one company that offers such policies. With a daily charge starting at just £3.99 for single-trip cover in Europe and £49.99 for a European annual policy, the savings are obvious.

In the above example had I taken out a single 8 day policy my saving would have been £128.

If like me you will be hiring a car again later in the year an annual policy (typically giving 60 days cover per annum) offers even greater savings.

One thing to point out is that in the event of a crash you would still have to pay the excess to the car rental company and then claim it back from the insurer upon your return.

So get organised and plan ahead before you even go on holiday - and start saving!

Leave a comment

  1. I have heard of someone making a significant saving by adding European car hire cover to their UK car insurance policy then making rental booking without any insurance from hire car provider. Need to confirm no insurance at all required Apparently saving a fortune almost having cost of the rental. Sounds so scary to me
    Do you have a view on this? Is this something you could do a piece on?

    1. Hi,

      It’s a great point and certainly something we can look into and analyse.

      Would make a great podcast section, so keep an ear out for it.

      Best wishes

      Damien

  2. Thanks for giving us a cheaper alternative as I do face some problems regarding hiring a vehicle and cannot bear the huge cost that is charged.