How Does the Vehicle Insurance Excess Pack Work?

23 February 2020

Aussies love a good road trip, it’s practically in our DNA! So with our wanderlust for the wide open road comes car rental, and with that, car rental insurance. If you’re the kind of traveller who likes to keep your premiums low, with the chance of paying high excess, then we have an optional extra made for you.

One of the ways to keep the costs of car hire down is to pay as little on the insurance as possible, right? But low policy premiums come with high excess, and in case or car rental insurance, we’re talking really high.

In Australia alone, car hire insurance excess – the amount you must pay if the car is damaged –  can easily amount to  $4,000 and above.

There’s an extra for that

Travel with Kit’s Rental Vehicle Excess Pack provides $5,000 cover for hire car insurance payment. If you rent a vehicle from a rental company while on your trip and it is involved in an accident, is damaged or is stolen while in your care, Travel with Kit will pay you the rental vehicle insurance excess.

Is rental vehicle excess insurance the same as vehicle hire insurance?

No, they are different things. We cover you for the rental excess costs you’ll need to pay should you incur damages or theft to your hire car and make a claim on your car hire insurance. In essence we cover the gap between what is covered by your actual car hire insurance and the cost of any damages to the vehicle up to $5,000.

Simply put, if you damage the car while it is in your possession, the car rental company will assess the cost to repair the damage incurred and will charge your credit card an excess – that is the amount we reimburse you with, up to $5,000.

Rental vehicle hire in Australia

In Australia the LDW (Loss Damage Waiver) insurance must be taken out when you hire a rental vehicle and this cover has an excess. You have the option to take out additional cover with the rental vehicle company called

Excess reduction

If the excess the hire company charges is less than the cover provided under the travel policy ie less than $5,000 you can elect not to take the excess reduction cover with the car hire company because your travel policy will cover the excess up to $5,000.

You must read the terms and conditions relating to both the options provided by the rental vehicle companies as there are exclusions.

Rental vehicle hire overseas

If you are renting a vehicle overseas, like in the USA for example, you can hire a car without taking any insurance whatsoever.

The driver’s liability is therefore the full cost of repairs and any third party damage. Depending on the accident or damage this could amount to a substantial sum.

Therefore, our travel insurance policy requires you to take out some insurance cover with the rental vehicle company because our insurance excess cover with a maximum benefit of $5,000 will not be enough cover in the case of a serious accident. Even if you take out their insurance cover, the excess with their policies can still be $15k to $20k.

This means you need to check the excess you will be liable to pay with their insurance, and take an excess reduction option with the hire car company if it’s greater than $5,000 because your travel policy will only cover you up to $5,000 excess.

Car share programs

Travel with Kit’s Rental Vehicle Excess Pack will only cover licensed rental companies such as Hertz, Europcar, Avis, Budget or Thrifty. We don’t cover car share programs like, GoGet, or Zipcar.

Understand your cover

Conditions and exclusions apply to every cover level and optional pack. View our Combined Product Disclosure Statement and Financial Services Guide for full details. Sub-limits apply. Not sure? Our friendly team are here to help. Get in touch