Car hire is a business that has roots in almost every part of the world. Car rentals make it easy for people to move from around, especially for tourists. When you hire a car, the car rental company expects you to return it in perfect condition or in the same condition it was when you took it. However, there are many things that can happen to that hired car while it is in your hands. That is why before the car hire company gives you the keys to the car, there is a car hire agreement that your get to sign. Many people are never keen enough to thoroughly read what is contained in the contract. One of the crucial terms that is contained in a car hire agreement is ‘excess’. So, what is an “Excess” in car rentals? How does it work? To learn more about car rental insurance and ‘excess’, visit https://www.car-hire-excess-insurance.co.uk/.
An ‘excess’ is the amount of money a car hirer is liable to pay to the rental company if the hired car gets damaged or stolen. Other terms used to refer to ‘excess’ are ‘deductible’ and ‘waiver’. An ‘excess’ ensures the car hirer and the car rental company do not incur the entire amount of repairing or replacing the car.
A car rental insurance protects the car hirer from being held liable for any damages that might occur on the rental car. Should anything go wrong while driving the car, rental insurance comes in handy in ensuring you do not incur hefty charges.
When hiring a car, the car rental company freezes a standard amount of money on the client’s card to be used as ‘excess’ in case the car gets destroyed, involved in an accident, or stolen. If the tenant returns the rental car in perfect condition or the condition it was when picked; the rental company releases the amount.
A car rental excess helps mitigate the loss incurred when a rental car gets into an accident, damaged or stolen by sharing the costs of replacing or repairing the car between the insurance company and the car hirer.
Assuming you rent a car and in the car rental agreement, the ‘excess’ amount is £1700. The car rental company will freeze the £1700 until your return the car back. If you get into an accident and the cost of repairing the damage sums up to £3000, the £1700 frozen in your card will be used to partially cater for the repair cost while the remaining £1300 will be paid by the car hire firm.
If the cost of damage caused on the rented car is below the ‘excess’ amount in the car hire agreement, the car hirer is liable to foot the entire amount. Say the cost of damage caused on the rented car is £1300, the car hire firm will not chip in money to complement. The entire cost of repair will be on you.
However, it is worth noting that in most car rental agreements, a car rental excess does not cover damages to the glass, roof, tires, undercarriage, and wheels of the car. Therefore, in case of such damages, the car hirer is held liable for the damages. Buying independent rental insurance can save you from going back into your pocket to cater for these damages.
Undercarriage car damages are common with vehicles having low ground clearance and mainly occur when driving on untarmacked and rocky roads. Undercarriage damages are quite expensive to repair; hence you should be cautious when driving a rented car on untarmacked roads.
If you return the rented car undamaged, the frozen money in your card is reimbursed after a couple of days or weeks, depending on the company’s processing speed.