We have all been there, standing at the car hire desk and realising that the insurance provided as standard isn’t really that comprehensive and we may be liable for £1500 if someone keys the car whilst parked in downtown Dijon, or you hit a pothole near Prague and the Seat Ibiza needs a new wheel. But do you buy extra cover from the rental desk jockey? Hmm, probably not.
Why? Well Which? has found that car hire insurance sold by rental companies can be up to 14 times more expensive and provides worse cover than policies bought online.
The consumer champion compared the cost of car hire insurance policies from major car rental companies with top-rated independent insurance policies that can be bought online, for a week’s hire in Malaga, Spain.
The most expensive policy was from Europcar, costing £203 a week. By comparison, the cheapest top-rated policy from a major online provider was from Chew Insurance, and cost just £14 a week – a saving of £189.
The research found that, on average, the six biggest car hire firms charge £147 for a week’s insurance, while the six top-rated independent insurance policies sold online cost just £23 on average.
The lowest price from a car hire company that Which? found, for a week’s insurance in Spain, was from Enterprise at £115. Avis, Alamo, Europcar, Goldcar and Hertz’s policies were all more expensive.
Additionally, all of the more expensive policies offered by the car hire insurance firms provide inferior cover to the top-rated independent insurance policies. Which? insurance experts gave the top six independent providers a policy score ranging from 75 per cent to 82 per cent. When car rental firms’ policies were rated, the highest scoring policies received a mediocre 61 per cent.
The best car hire insurance included cover for damage to a car’s tyres, windscreen and underbody, flat battery cover, admin charges, car-jacking, towing cover, personal accident cover, among other features.
Questor Insurance, which received the top policy score of 82 per cent, charged just £24 for a week’s insurance in Spain. Questor offered cover for misfuelling, getting locked out, and lost or damaged keys. Despite costing £179 more, Europcar didn’t offer any of this cover as part of its policy.
The policies sold by major car hire companies contained a significant number of exclusions. Examples of incidences where a driver wouldn’t be covered include if an Avis customer had a stone chip their windscreen, if an Alamo customer got a flat tyre, or if a Hertz customer got locked out of their rental.
As well as offering cover for these accidents, the top-rated independent policies also offer cover for drivers who get locked out of the car, if they accidentally put the wrong type of fuel in the car, or are forced to cut short their hire. They also offer cover (usually up to £300) for any personal items that are stolen from the car. None of the more expensive policies from the car rental firms cover all of these incidents.
The only disadvantage of taking out an independent policy is that customers would still have any charges deducted from their credit card by the hire company, having to claim them back from their insurance afterwards.
As car hire has become an increasingly competitive market, the price of rental has dropped as low as £1 per day in some cases, meaning car hire companies often make their money from the sale of extras.
Which? has previously exposed car hire companies using pressure selling tactics to persuade customers to pay for these extras. Last year, Which? caught Europcar’s budget arm, Goldcar, on camera lying to and bullying customers into buying expensive cover.
Additionally, one in four (26%) Which? readers in the consumer champion’s most recent car hire survey said they were stung with unexpected charges, and a quarter of those who paid extra, ended up forking out an additional £200 or more.
While cover bought online can be significantly cheaper than policies bought from a car rental firm, Which? is also reminding holidaymakers looking for car hire insurance not to be swayed by the lowest price available online. Not all policies available online from independent providers are worth it, so always check the terms of the policy and the cover on offer before buying.
Rory Boland, Editor of Which? Travel, said:
“Car hire is an industry plagued with unscrupulous practices, with wildly excessive charges for sub-standard insurance policies just one of the pitfalls customers should be wary of when choosing a rental company.
“The good news is that, no matter how a car hire salesperson may try and persuade you at the desk, you don’t have to fork out for one of these eye-wateringly expensive policies. Much more thorough cover is available online for a fraction of the cost, meaning you can enjoy your holiday with peace of mind that you’ll be covered if something goes wrong with your rental.”