When you’re planning a trip to the UK, renting a car is often the most convenient way to explore the beautiful countryside, iconic cities, and scenic coastlines.
But there’s one thing that many people forget to think about when they pick up their rental car: car hire excess insurance.
If you’re like most travelers, you might be wondering if it’s really necessary or if you should just rely on the coverage provided by the rental company.
In this guide, I’ll explain everything you need to know about car hire excess insurance in the UK for 2025.
I’ll walk you through what it is, why you need it, and how to find the best options available, so you can enjoy your trip without worrying about hidden costs or unexpected charges.
What is car rental excess insurance?
Car rental excess insurance is a type of coverage that helps reduce or eliminate the amount you have to pay in the event of damage or theft to your rental car.
When you rent a car, the rental company usually offers a basic level of insurance that covers some damages.
However, they usually leave a significant “excess” amount, which you will have to pay out of pocket if something goes wrong.
For example, if the excess is £1,000 and you are involved in an accident that damages the car, you could be liable to pay up to £1,000, even though the rental car itself may be worth much more.
This is where car rental excess insurance steps in – it covers the excess, ensuring that you don’t have to pay for any damage or theft.
Why do you need car rental excess insurance?
When you rent a car in the UK, the insurance provided by the rental company may seem sufficient. However, the excess can be a huge financial burden if something goes wrong.
Here are some reasons why you should seriously consider getting car rental excess insurance:
Reduce financial risk: The main reason people choose additional insurance for car rentals is to protect themselves from paying a large sum out of pocket.
If you are involved in an accident or the car is stolen, the extra £500 to £2,000 can be a lot of money to lose. That’s a lot of money to lose, especially if you’re on holiday.
Peace of mind: Car rental excess insurance gives you peace of mind. You can drive away without worrying about the financial consequences of a small scratch or an unfortunate accident.
If the rental company decides to charge you for the damage, the insurance will cover the excess and you won’t have to pay a penny.
Affordable and convenient: Compared to the cost of the rental company’s coverage, buying car rental excess insurance separately is often much cheaper.
Plus, you can buy it online in advance or even when you pick up the car, so it’s extremely convenient.
How does car rental excess insurance work?
1. Renting a car: When you rent a car, the rental company will offer you basic insurance coverage. This insurance usually covers damage or theft of the car, but it comes with an additional amount that you will be liable for.
This is part of the additional cost that you must pay if the car is damaged or stolen. This can range from £500 to £2,000 or more, depending on the car and the rental company.
For example, if you rent a car and it gets scratched, the rental company may charge you a damage fee of £1,000, which is the additional amount. If the damage is more serious, the fee may be higher.
2. Buying additional insurance: At this point, you have a choice: you can either accept the rental company’s additional fee or you can buy additional car rental insurance to cover the amount you have to pay.
3. Filing a claim
In the event of damage or theft, you will need to:
Report the incident: Notify the rental company immediately of the damage or theft.
Document everything: Take photos of the damage and make sure you get a copy of any police reports, if applicable (for theft or serious damage).
File a claim: Contact your insurance provider and file a claim. This is when insurance will cover the excess, ensuring you don’t end up out of pocket for damage or loss.
4. Peace of mind: With car rental excess insurance, you drive with peace of mind. You don’t have to worry about the unexpected financial burden of an excess amount because your insurance will cover it. Whether it’s a minor scratch or a major accident, you’re covered.
5. Excess insurance costs: Excess insurance is usually quite affordable. It can range from £5 to £10 per day, which is significantly cheaper than what rental companies charge for the same coverage.
Over the course of a week, it can save you a considerable amount of money, and you have the added benefit of knowing that you’re fully covered if something happens.
In short: When you rent a car, the rental company will provide basic insurance with an excess.
Car rental excess insurance helps cover that excess amount, protecting you from having to pay it if the car is damaged or stolen.
You can buy this insurance from the rental company or a third-party provider, with third-party providers usually offering lower rates.
In the event of damage or theft, you will file a claim with your insurance provider, who will cover the additional fees, so you don’t have to pay it.
Where to get car rental excess insurance?
There are two main places you can buy car rental excess insurance: directly from the rental company and through third-party providers.
1. Direct from the rental company
Most car rental companies offer excess insurance when you book or when you pick up the car. This is convenient, but it is usually more expensive. The cost of insurance can sometimes be double the price of the rental.
2. Third-party providers
Many travelers find that third-party car rental excess insurance is cheaper and more flexible. Some of the best third-party insurance providers for car rental excess coverage in the UK include:
Insurance4CarHire: Known for offering comprehensive coverage at competitive prices, Insurance4CarHire offers car rental excess insurance in the UK and beyond. They offer policies with no extras, which is a great option if you are worried about paying anything up front.
Worldwide Insurance Services: They offer affordable policies with great coverage for UK car rentals. They offer worldwide car rental excess insurance, so you can be covered no matter where you’re renting a car.
Car Rental Excess: This provider offers a straightforward and affordable way to cover excess for your rental car. Their policies are simple, and they offer protection for both damage and theft.
When you’re looking for the best car rental excess insurance for your trip, here are some key things to keep in mind:
Coverage Limits: Some policies have limits on how much they will pay in the event of damage or theft. Be sure to check the terms and conditions to make sure the coverage is adequate for the value of the car you’re renting.
Exclusions: Always read the fine print! Some policies exclude certain types of damage, such as tire damage or a cracked windscreen, so make sure the insurance covers everything that’s important to you.
Excess Amount: While the main goal is to reduce or eliminate excesses, you should still check how much you’ll have to pay in the event of a claim. Some policies cover the entire excess amount, while others may only cover a portion of it.
Benefits: Make sure the provider allows you to easily purchase insurance and that you can file claims in a hassle-free manner. Some providers offer 24/7 customer support, which can be a lifesaver in an emergency.
How to Save on Car Rental Excess Insurance
It’s always a good idea to look for ways to save money while making sure you’re properly covered. Here are some of our tips for finding the best deal:
Book in advance: Buying additional insurance on a rental car before you arrive at your rental destination can save you money. Many third-party providers offer cheaper rates if you buy insurance in advance.
Avoid over-the-counter insurance: If you can, avoid buying additional insurance directly from the rental company, as their rates tend to be higher. Choose third-party providers who offer better rates.
Check your credit card benefits: Some credit cards offer car rental insurance as a perk. If your credit card has this benefit, you don’t have to buy additional coverage. Just be sure to check the terms and conditions.
Car Rental Excess Insurance vs. Credit Card Insurance
Many travelers don’t know that their credit card may already offer some type of car rental insurance. However, this coverage is often limited. While credit card insurance may cover some damage to a rental car, it usually doesn’t cover things like theft, lost keys, or damage to tires and windscreens.
In contrast, additional insurance for renting a car from a dedicated provider offers more comprehensive coverage, so you may still need to purchase additional insurance.
What to do in case of damage or theft
Document the damage: Take clear photos of the damage and make sure to get a copy of the police report if the car is stolen.
Notify the rental company: Notify the rental company of the situation immediately. They will guide you on what to do next.
File a claim with your insurance: Contact your car rental additional insurance provider and file a claim. Be prepared to provide all the necessary documentation.
Conclusion
Additional car rental insurance is a smart investment for anyone renting a car in the UK. It helps you avoid the financial burden of paying high additional charges if your rental car is damaged or stolen.
By purchasing the right coverage, you can drive with peace of mind and enjoy your trip without any worries.
FAQ
Do I need car hire excess insurance if I already have car rental insurance?
Even if you already have car rental insurance, the rental company’s coverage might not cover the full excess amount. Car hire excess insurance can fill in the gap, giving you extra protection.
Is it cheaper to buy car hire excess insurance from the rental company?
No, buying insurance from the rental company is usually more expensive. Third-party providers tend to offer better deals with more comprehensive coverage.
Can I buy car hire excess insurance after picking up the car?
Yes, you can purchase car hire excess insurance after picking up your rental car, either from a third-party provider or the rental company. However, buying in advance is often cheaper.
What happens if my rental car is damaged or stolen?
If your rental car is damaged or stolen, you should report it to the rental company immediately. Then, contact your car hire excess insurance provider to file a claim, and they will cover the excess amount.