Travelling abroad – insurance for rental cars

Many dream of travelling abroad in a hire car. But what if you cause damage to the vehicle? Will the car rental insurance pay out? Comparis explains the ins and outs.

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The side window of a car has been smashed.

iStock / Joel Carillet

1.The trip – paid for but then missed
2.Broken car window covered – but not the stolen suitcase
3.Home contents insurance to the rescue
4.Better safe than sorry

Pure freedom – Rachel and Harry are taking a tour around Australia in a rental car. But right at the start, an unforeseen incident occurs: thieves break a window on their car and steal the suitcase from the back seat. This prevents them going on a diving trip they had booked. And they need proof of the incident.

At first glance, everything seems OK – Rachel had insisted on the best possible cover when she took out insurance on the hire car. As expected, the broken window damage is covered and a courtesy car is made available the same day. Unfortunately, they need to pick it up themselves, and the nearest branch of the car hire company is 250 kilometres away. This detour means they won’t manage to catch the boat for their planned 4-day trip.

The trip – paid for but then missed

The diving trip was meant to be one of the highlights of their adventure, and Rachel and Harry had splashed out on it: they paid 1,200 francs for the trip. Should they still have to pay, even though they didn’t get to enjoy the trip? Rachel remembers that cancellation expenses insurance was listed in the policy of their travel insurance but the documents are at home in the cupboard. So she googles the telephone number to enquire. Since Rachel and Harry missed the trip through no fault of their own, the cancellation is covered. The cost will be reimbursed on production of the police report. To be on the safe side, they make a note of exactly how they managed to miss their boat.

Broken car window covered – but not the stolen suitcase

In the meantime, the rental car company is dealing with the damage to the car, and Rachel and Harry are thankful that that's one thing they don't have to worry about. But the stolen suitcase is cause for concern. They have to report that separately, and the car hire company refer them to the American insurer responsible for luggage insurance for the hire car. This alone is complicated enough, but the sheer quantity of forms that Rachel and Harry have to fill out is starting to test their patience. What’s more, they cannot provide the required proof for every detail of their story, and the process gets delayed. Three months later they find out that luggage kept in the car overnight is not covered. This is stated in the small print of the policy.

Home contents insurance to the rescue

In a final attempt to get their money back, Rachel and Harry report the incident to their home contents insurer. Thanks to the “simple theft away from home” option, the insurance company covers the loss with no trouble. In hindsight, it would have been much easier to report the theft to their home contents insurer in the first place. But they weren’t to know how much stress they would be under.

Eventually, Rachel and Harry get everything reimbursed. The damage to the car, the cost of the suitcase and its contents – as well as the cost of the diving trip that they had already paid for but couldn’t go on. They are both grateful that they didn't lose out financially.

Rachel and Harry were able to continue their holiday with no further issues – with the same feeling of freedom but with a little extra vigilance.

Better safe than sorry

  • Personal assistance, cancellation expenses insurance and luggage insurance are the three components that all travel insurance should include, unless the risks are covered elsewhere. Cancellation expenses insurance should not be confused with trip cancellation insurance, as made clear in another example: Broken leg and extended stay on holiday – What will travel insurance cover?

  • Have a look at your home contents insurance policy. Does it include the “simple theft away from home” option? If so, stolen luggage is also covered and you do not need to include it in your travel insurance as well. This article may also be of interest in this context: Loss of luggage – What will travel insurance cover?

  • In the event of theft, your insurance company will ask to see a police report. Make sure you keep this safe and make a note of all the details of the incident – time, place and any details of changes to your travel plans. Photos of damaged or stolen items may also be useful. This will help you to answer any questions from the police or your insurance company and provide concrete proof, should the worst come to the worst.

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