04.Reduce the excess
Many companies will offer you a choice to reduce the excess — for a fee. It can range from a few dollars to around $30, but is typically in the order of $20 per day for short-term rentals. This extra cover will substantially reduce the maximum excess payable, but can quickly add up over several days of car hire.
But there are alternatives, including:
Domestic travel insurance often covers you for rental car excess. For example, a two-week $89 Australian Plus Travel Plan with QBE will cover your liability to $3000. The cost of the policy is a lot cheaper than paying over $20 per day for two weeks’ excess reduction.
RACV offers an insurance plan called Reimbursement of Car Hire Excess, which costs $72 (discounted further according to length of membership) for $3000 cover. See if your state’s motoring organisation has a similar deal.
Some credit card companies offer some form of travel insurance when you use their card for travel purposes.
It’s important to realise this cover doesn’t apply to accidents excluded under the rental car company’s terms and conditions (see Exclusions).
Case study - Excessive excess
You might be a careful and skilled driver and reckon on going without an excess-reduction package. But once you take the keys to the rental car, you’re responsible for any damage that occurs, which, depending on the company, can include that caused by rampaging kangaroos, hailstones or careless drivers not honest enough to leave a note when they hit your unattended car — as Kathy from Brisbane discovered.
On day two of her car rental, Kathy noticed a large dent and black scrapes on the car’s front bumper, and knew she hadn’t been responsible. About a month later, and without any prior notice, the full excess amount was deducted from her credit card.
Minor damage like this becomes very expensive, because you’re not only liable for the cost of repairs, but also costs like damage appraisal, administration expenses (time taken to make arrangements for repair and so on) and losses due to the vehicle not being available to rent out.
Kathy was never sure if the incident had occurred under her charge, because like many exhausted travellers reaching their destination, she didn’t quite have the presence of mind to carefully check the car first. "As in most airports, the keys are handed to you at the desk, you then struggle with kids, kids’ paraphernalia, luggage and the odd stray grandmother out in the hire car lot, and look for what seems forever for your hire car with no representatives to help you."