chad75

Alamo will normally quote a CDW inclusive rate if you use an Australian address.

I don't feel you have to take out any other insurance. The CDW will cover any damage to the car.

If you are sued or held personally liable for damage/injury to a third party, the typical visa gold travel insurance from NAB, Citibank etc. provides liability insurance up to 5 mill (depending on the bank).

So:

CDW - covers the car
Visa travel insurance - covers personal liability (but not normally the car)

Normal disclaimer: double check with your bank etc

ozstamps

In oz our CAR is covered by vehicle ins, -- i.e. Ins does not cover a driver as it does in USA. I rented in Darwin this month - my SYD policy did not cover me there for ANYTHING!

In Aust NO credit card offers ins. against harm or injury you make tov another whilst drving. This explains it a little!

http://www.siteware.com.au/ExcessesAndUSCarRentals.pdf




Mr. Roger Wootten,
Manager Sales Support
QBE Travel Insurance

Dear Roger,

Thanks so much for your timely reply to our query on the issue of Australians renting cars in
America.
We agree that there is indeed a rather significant disparity in the way rental car insurance is
structured in the agreements offered to Australians hiring cars in the U.S. compared with those in
Australia.
Whilst Australia has chosen more of a U.K. model for offering insurance on rental cars. Under this
model, as I'm sure you're familiar, the rental car is automatically insured against loss, theft and
damage with an excess on any claim payable by the hirer. In contrast, the U.S. system rests on a
waiver structure, where the hirer is released from liability to the rental car company by paying the
rental car company to waive it's rights to collect for damage, loss and loss of use of the car rented.
EXCESSES VERSUS WAIVERS
Unlike the Australian pay-excess model, the American rental car companies do not offer an excess
(see Common Waiver and Liability Clauses, and Notes below), as a collision damage waiver
(CDW, sometimes termed "Loss Damage Waiver") covers the cost of damage/loss to the rental car.
The CDW is perhaps not strictly "insurance" -- it is simply a provision of the hirer's rental
agreement that releases the hirer from liability for loss of, or damages to the car.
U.S. travel insurance policies are nearly identical to those underwritten in Australia. The policies
include all the normal trip cancellation, baggage, medical assistance, repatriation and other
provisions found in Australian policies, with the notable exception that the Rental Car Excess
paragraph is replaced by a CDW paragraph. The following example is quite typical of this,
underwritten by ACE Asia-Pacific's division in America ("ace usa") for the U.S. travel insurer
TravelGuard:
"COLLISION DAMAGE WAIVER
"Coverage does not apply in countries or states where the sale of this insurance is prohibited by law.
"If the Insured rents a car while on his/her trip, and the car is damaged due to collision, theft,
vandalism, windstorm, fire, hail, flood or any cause not within the Insured's control while in his/her
possession, or the car is stolen while in the Insured's possession and not recovered, the Insurer will
pay the lesser of:
(a) the cost of repairs and rental charges imposed by the rental company while the car is being
repaired; or (b) the actual cash value of the car.
Coverage is provided to the Insured and his/her Travelling Companion, providing the Insured and
his/her Travelling Companion are licensed drivers, and are listed on the rental agreement. This
coverage is primary to other forms of insurance or indemnity.
"In addition to the General Exclusions, coverage is not provided for loss due to:
(a) any obligation the Insured or his/her Travelling Companion assume under any agreement
(except insurance collision deductible); (b) rentals of trucks, campers, trailers, off-road or four
wheel drive vehicles, motor bikes, motorcycles, recreational vehicles or Exotic Vehicles; (c) any loss
which occurs if the Insured or his/her Travelling Companion are in violation of the rental
agreement; (d) failure to report the loss to the proper local authorities and the rental car company;
or (e) damage to any other vehicle, structure or person as a result of a covered loss. "
As you can see, the CDW pays for the car, and pays the rental car company for "loss of use." Lossof-
Use is what the rental car company will charge the hirer for the money and time it lost since the
Excesses and U.S. Car Rentals
2
vehicle could not be rented. This is included for American car rentals because motor vehicle
insurance in most states in the U.S. does not cover loss of use under the hirer's normal motor
vehicle insurance policy (the exceptions are: Alaska, Connecticut, Louisiana, Minnesota, North
Dakota, New York, Rhode Island and Texas).
WHY PAY MORE?
The reason CDW and Liability insurance is included as part of standard travel insurance policies
in the U.S. is largely due to the comparatively high rates charged for the same coverage by the
American rental car companies. It's clearly cheaper to buy a general travel insurance policy that
includes a CDW, rather than pay at the car rental counter. For a week, CDW alone costs $US1051
and liability runs about $US761, all on top of the $US3451 base rate.
The above-referenced ACE USA coverage for CDW is $US6 per day per vehicle, including cost of
repairs for collision or comprehensive damage to a rental car, up to $US35,000, for which the car
rental contract holds the hirer responsible.
Americans have additional options for avoiding the relatively higher insurance fees charged by the
U.S. rental car companies. For U.S. residents, the hirer's motor vehicle insurance policy will
usually include liability insurance if the hirer injures someone in an accident (regardless of vehicle
being driven ¾ the individual is insured rather than the car as in Australia). Similarly, damages to
the rental car are covered under the U.S. hirer's comprehensive and collision coverage.
U.S. residents also benefit from free travel insurance coverage that includes CDW and liability, by
using their credit card to hire a car. The Visa Gold program most notably in the U.S. provides this
needed coverage, allowing the hirer to bypass the rather expensive CDW and liability insurance
sold at the rental car company counter. Unfortunately, Australian residents are not offered such
coverage ¾ Visa Gold in Australia does have a limited accident-only travel insurance, which does
not address CDW nor liability.
AN AUSTRALIAN IN NEW YORK
All of these differences in the insurance structures between Australia and the U.S. mean that
Australians hiring cars in the U.S. must purchase their collision and liability insurance as an added
extra, as neither are included in their Australian travel insurance ¾ remarkably, even in policies
specifically recommended for travel to North America. It is perhaps a questionable practice for
Australian insurers to sell rental car excess insurance for North American when it is of such
dubious utility. It could even be considered misleading to the extent that a reasonable person
would assume that the included Rental Car Excess insurance in their North American policy would
be of similar value in America as such coverage would be in Australia. Otherwise, why would it be
offered?
As neither Australian credit card programs, nor the motor vehicle insurance held by most
Australians provide for CDW or personal liability in a rental car, it is only natural that travellers
turn to their travel insurance policies to cover them appropriately for the markets in which they
are travelling.
1 Intermediate Car, Avis (RNO 9-16 Aug 02)
Excesses and U.S. Car Rentals
3
NORTH AMERICA ADD-ONS
It may seem foreign to Australian underwriters that U.S. car rental companies don't offer excesses
as is common here, but that is rather the point: It is foreign. Offering insurance for rental car
excess for travellers to North America seems somehow disingenuous. Especially when there are
multinational insurers operating in Australia with related divisions or insurers in the U.S. ¾ the
lack of regional policy coordination in the car and travel divisions between such subsidiaries is
striking.
Underwriters of travel insurance sold to Australians should recognise the needs of their retail
clients by providing optional add-ons for North America that allow for CDW and liability. The
ability of Australian insurers to deeply undercut the rates charged by their American counterparts
would seem to be clear-cut. By placing reasonable caps on payments (i.e. $A40,000 – 70,000) for
rental car damage/replacement, and for personal liability, Australian travel insurers could sell a
truly useful product offering good value for Australian's travelling to America.
Whilst Australian insurers may not have an interest, either financially or through market pressure,
to provide travel insurance appropriate to the North American market, the need for selling
meaningful coverage to Australians hiring cars overseas should not be discounted.
WHAT'S THE EXCESS, U.S.?
Since American rental car companies do not understand the phrase "rental car excess" (nor do
most Americans), the obvious question is how to define the excess for North American policies.
Without the rental car company being able to outline or define what the excess is, either by
definition or dollar liability, it is unclear how an Australian would be able to ascertain the excess
amount.
Budget Australia, which offers a fairly unique way of insuring with an all-over protection plan,
goes so far as to define an excess as the total liability, in that " The liability (called an excess) varies
… The standard excess is a substantial amount but is still a small proportion of the value of the
Budget vehicle."
Really, as Australian travel insurance is written in Australia for Australians, there is generally not
problem with defining excess, as all Australian rental car companies comply with the commonly
held definition in structuring their insurance products. This is only an issue with North American
policies sold in Australia due to the lack of recognition of the term.
"Excess" as defined by a leading American dictionary2 does not mention the intended meaning as
used by Australian insurance, and lists only the two main meanings in U.S. parlance:
1 a : the state or an instance of surpassing usual, proper, or specified limits : SUPERFLUITY b : the amount or
degree by which one thing or quantity exceeds another <an excess of 10 bushels>
2 : undue or immoderate indulgence : INTEMPERANCE; also : an act or instance of intemperance <prevent
excesses and abuses by newly created local powers -- Albert Shanker>
Further, Dictionary.com3, perhaps a more salient source these days, in it's brief style reports:
2 Miriam-Webster Collegiate Dictionary, US;
go to http://www.m-w.com/cgi-bin/dictionar...nary&va=excess
3 Dictionary.com; go to http://www.dictionary.com/cgi-bin/di...=*&term=excess
Excesses and U.S. Car Rentals
4
1. The state of exceeding what is normal or sufficient: rains that filled the reservoirs to excess. 2.
An amount or quantity beyond what is normal or sufficient; a surplus. 3. The amount or degree by
which one quantity exceeds another: Profit is the excess of sales over costs. 4. Intemperance;
overindulgence: drank to excess. 5. A behavior or an action that exceeds proper or lawful bounds:
tried to avoid engaging in emotional excesses such as hysteria and fits of temper.
In contrast, the Australian definition for "excess" in the Macquarie Dictionary4 clearly includes the
common reference to Insurance, as follows:
1. the fact of exceeding something else in amount or degree. 2. the amount or degree by which one thing
exceeds another. 3. an extreme or excessive amount or degree; superabundance: have an excess of energy. 4.
a going beyond ordinary or proper limits. 5. immoderate indulgence; intemperance in eating and drinking. 6.
Insurance the first portion of a loss, being an agreed or fixed sum, which the insured (usually in consideration
of a reduction of premium) agrees to bear.
Of course, taking the above Australian definition, one comes to the phrase "first portion of a loss"
¾ an item which remains undefined by the U.S. rental car companies, and something which
Australian travel insurers do not define in their promotional brochures, premium tables, or other
material readily available to the travelling public.
With neither the U.S. car rental companies, nor Australian travel insurers defining what portion is
deemed the "excess" (if any) of the CDW, liability or any other rental car insurance offered in the
U.S., it makes it difficult at best for an Australian consumer to comprehend the conditions under
which the travel insurance might pay.
JUST SO WE KNOW…
If you would please Roger, define for us, given the general policy terms and conditions of the U.S.
rental car companies, and for U.S. car hires, when the excess is payable:
Is the excess just a portion of all possible liability, or does it constitute the entire liability?
Does the excess apply only to insurance coverage purchased, or does the excess apply to the
non-insurance damage waivers? If it applies to the damage waivers, and no waiver is
purchased, how is the excess calculated?
Is the definition of the excess portion entirely up to the claims staff, or is there a more
detailed policy explanation somewhere?
Thanks so much for your efforts ¾ it's just unclear what the Rental Car excess pays for, and we'd
like to know before we go off to the States this August.
Sincerely,
David James Sether
4 The Macquarie Concise Dictionary, Australia;
go to http://www.macquariedictionary.com.au/, enter "excess" in search field
Excesses and U.S. Car Rentals
5
Common Damage Waiver and Liability Clauses
From Avis, Hertz and Budget, clauses for Australia and the U.S.
(Where needed, rental terms were written for a one-week rental from the Reno, Nevada airport for US
policies, and Sydney Airport for Australia)
Avis
U.S.
General
The Avis renter is responsible for all damage or theft of the Avis vehicle subject to certain
exclusions contained in the Avis rental agreement. For an additional fee, Avis will waive or limit
the renter’s liability through the purchase of a Loss Damage Waiver at the time of rental. Please
call 1-800-230-4898 for additional information.
https://www.avis.com/AvisWeb/JSP/glo...e_policies.jsp

Kremmen

That's always something I've not understood either. As far as I know, most US car insurance policies include an excess (usually called a "deductible", since US companies so love using long, pretentious words). However, the equivalent for car rentals, as is noted in that letter to QBE, are all or nothing.

Does anyone here know why this is? Insurance with no excess is always going to be very expensive, because of the costs to the insurance company of handling lots of small claims, which would simply never happen if there was an excess to be paid by the policyholder.

ozstamps

Just a footnote/update to this thread, as the same question is being asked on another thread.

And this is worth noting for all of us ozzies who rent cars in the USA most especially.

Most of the (well meaning) comments on this thread have been made by Americans - who are WONDERFULLY covered for all USA rentals pretty much, by their OWN auto insurance AND their credit cards. As assume the rest of the first World enjoys the same deal. I know LOTS of very sensible USA FT'ers who NEVER even consider taking ANY kind of ins on rentals anywhere in the USA. They simply do not generally need any.

Ozzies have NEITHER cover. @:-)

This specific case I posted in thread is interesting.

I booked Alamo, and printed out the info in my post #1 as well as this email I got from them when I asked about rental cover:

Dear Mr. ozstamps:

Thank you for your email inquiry. We appreciate the opportunity to address
your concerns.

EP and SLI is not available at this location. TPI is already included in your
rental car rate. Only CDW is available but is already included in your rate
as you stated.

Should you need further assistance, please feel free to contact us again.

Sincerely,
xxxxxxxxxx.

Alamo International Internet

So I rock up to rental counter in Fairbanks Alaska and girl tries to sell me insurance. I tell her CDW ($22 a day) is included already in my rate. She assure me it is NOT. Nor is TPI.

She is most insistent.

I produce this email and she looks horrified. Had I not had it she'd have made me pay for it you can bet.

PRINT OUT AND CARRY WITH YOU THE RATE INCLUSIONS OFF WEB BOOKING, AND ANY EMAIL IS MY ADVICE!

Also please note that Alamo advised me some Ins is NOT buyable (at any price) from some locations such as EP and SLI. Worrying.

AllanJ

Which CDW is included in the rate? The maxi-waiver-saver? Ask.

(The OP does list the various CDW's that Alamo offers)

Some personal auto insurance covers rental cars, some does not. Check with your insurance agent or carrier.

Normally if you accept CDW, any rental collition coverage offered by your credit card specifically does not apply. Check with your credit card company to see how they treat this "CDW included" pricing situation.

Travel tips:
http://members.aol.com/ajaynejr/travel.htm