This category has the potential to eat into the large profits that the car rental companies have been enjoying for decades. What is different about this category is that unlike using
travel insurance or credit cards to hope you are covered for what you think you should be covered for, this car rental excess insurance is designed specifically for competing head to head with the car rental companies.
The main difference between the insurance product and the car rental companys’ product, is that in the event of an accident you would need to claim with the insurers such as Allianz Global Assistance, QBE, whereas if you use the more expensive car rental companies waiver (CDW) they handle any damage issues.
And by expensive we mean very expensive. The car rental companies waiver can cost as much if not more than the rental per day with the car rental excess insurance supplied by Tripcover coming in as low as $5.60 per day.
The category has seen amazing growth over the last 4 years with estimates that some
$12M in sales in the last financial year, from these companies. This represents about 200,000 policies sold out of 6.5M rentals in Australia per year or around of 3% of the market so far.
It is predicted that by 2020 the car rental excess insurance market in Australia will be 10% of the car rental market, worth $38M.
Off Airport Rentals: Don’t get the rental at the airport as there are airport loading fees and generally the rates are more expensive.
City Versus Suburbs: Check out the rates suburb by suburb as you can sometimes get better deals outside the city centre locations.
Standalone Car Rental Excess: Don’t take up the car rental companies’ offer to reduce your deductibles or excess liability, more commonly called CDW (collision Damage Waiver) This can nearly double your rental. Use standalone car rental excess reduction sites like tripcover.com.au . Their cover starts at around $9 per day and reduces down to around $5 per day over 15 days and covers ALL incidences including windscreens, single vehicle accidents, overhead damage etc. Use your AU or NZ Frequent Flyer number for a further 10%.
Discount Codes. Look out for discount codes like this one: 47684365 This will give you a 15% discount with Europcar, for example:
Of course I used Tripcover to cover my excess and reduce it to $0 for $13.60 per day.
When I got to the Thrifty rental desk I was told that if I wanted to use my MC debit card that they would need to take the $3300 excess out of my account right now. Otherwise I was going to have to take out their very expensive $27 or $33 excess cover. I told the guy that I did not have $3300 in my account and he simply smiled and said “I knew that, as most people usually don’t”. Ca-Ching!! His eyes lit up with $ $ signs.
I told him that I already had insurance with Tripcover and he smiled again and said his hands are tied. Finally When I told him that I thought that this was outrageous he simply smiled again and said ” I know!”
I think Thrifty should make their policy clear with regards debit cards as the car rental company knows that once we get to the desk we have little or no choice at that point.
PS. When I returned the car I pointed out that their terms and conditions on their website
did not indicate this new policy. I was told that it was so new that it was not on their website. Go figure! I am supposed to know about their new policy by rolling up to their desk and get informed on the spot. I think this is why the ACCC has targeted the car rental industry because of this type of treatment of their customers. Although they were apologetic this time, I will be calling their head office and requesting a refund of my $27 extra insurance that I was forced to purchase, with no mention in their T&C.
PPS: Yeah! I got a response from head office and all is good, I think.
Good afternoon Mr Sherlock and thank you for taking the time to get in touch with us.
As a Blue Chip member no bond is payable from you at any time. There has clearly been an issue with our staff member on front counter misinterpreting an internal directive and I hope that you can accept my apologies for any confusion and any pressure to reduce your damage liability against your wishes. I have today directed our accounts department to refund $27.94 back to your debit card.
Smart Traveller article from The Age and the Sydney Morning Herald on Tripcover
July 7, 2012
Sherlock Cracks the Case
Desmond Sherlock is a thorn in the side of Australian car-rental companies. About six months ago, he started tripcover.com.au, the first insurer to specialise in car-rental excess insurance.
“Our premiums are about a third cheaper than what you get with the rental companies,” Sherlock says. “Their insurance rates are usually from $22 to $27 a day to reduce the excess to $300. Our rates start at $9.30 a day.”
Sherlock says that some car-rental policies have excesses up to $6000. Of 6.8 million annual car rentals in Australia, between 30 per cent and 40 per cent of people opt to buy excess reduction.
He agrees many travel-insurance policies also provide car rental excess reduction, but claims his company (managed by Allianz Global Assistance) is the only specialist in Australia and soon hopes to offer an annual policy and expand to New Zealand.
What is it about the car hire industry that makes it a candidate for the most poorly behaved corporate sector in Australia?
Over a decade or more up until the middle of last year, it seemed to me the car renting business had become virtually incapable of telling the truth about the real cost of renting a car.
The headline rate that appeared in advertisements was usually about half what you’d be up for when you added all the asterisked charges, then put petrol in the tank. Heaven help you if you took the car back with a tank that needed topping up at the renter’s sky-high prices
Read more: October 4, 2010
· I booked a car online for one day in Sydney for a fleeting day trip to be at a special occasion for an old friend. The email receipt I received for my reservation mentioned an additional fee for ‘excess reduction’ on top of what I’d already paid for excess cover, but did not mention what the excess would be if I did not pay the fee. I found out when I arrived to pick up the car that it was a whopping $3500 excess which I think is a risk few people would be willing to wear. So in fact my rental for the day was $30 more than I was quoted PLUS an additional airport fee of $18 which was also not mentioned along with the “airport concession fee recovery” of $11 quoted in the receipt. No way would I have rented a car for the day if I’d known how expensive it would be.
October 04, 2010, 10:46AM
Read the contract. Be aware of your responsibilities. Ignore the super deals advertised and negotiate the full price at the counter. Use your phone/camera take photos of vehicle before you leave for damage reference. Would you lend your brand new car to a complete stranger without any conditions for $50 a day?? No, so cover your arse and read the fine print.
October 04, 2010, 10:47AM
If you have insurance, you shouldn’t have to worry too much about excessive charges for damage. Take a video camera and do a once-over of the car to identify any marks and report any that aren’t on the paperwork before you leave the car park. Other than that, there isn’t too much that can go wrong. If you forget to fill up before returning the car, it’s hard to blame the rental company. The fuel gauge will indicate full for a while after you fill up.
Welcome to Tripcover’s blog! Car hire customers are starting to realise that no longer do they have to pay between $22 and $27 to reduce their excess on their car rental.
Using Tripcover you can save up to 60% on the car rental companies’ rates for exactly the same cover. Tripcover is the first company in Australia that exclusively sell car rental excess insurance and the car rental companies don’t like us!
Why not take a look and get a quick quote at Tripcover.com.au and you will be pleasantly surprised.