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Does my car insurance cover rental cars?

If you’re looking at the possibility of renting a car for short term use, you might be wondering whether you’ll need to purchase additional insurance – or whether you can use your own insurance for a rental car.

Here, we’ll explore the subject in a little more detail – looking at what your insurance is likely to cover you for – as well as the best way to insure a rental vehicle.

If I rent a car, will my insurance cover it?

Lots of people assume that renting a car is a little like borrowing a car from a friend or family member – and also assume that as long as they have insurance on their own vehicle, they’re covered to drive someone else’s car.
In actual fact, this might not be the case.

There are two things to consider here – firstly, whether you can actually drive another person’s car on your own policy – and secondly, whether or not you actually need to do that with a rental vehicle.

Can you drive other cars on your policy?

In the past, insurance companies generally gave fully comprehensive policy providers the perk of being able to drive someone else’s car – provided they had given you permission of course.

The car you were driving had to be insured – but as long as it was, your fully comprehensive cover generally meant that driving another car could be done on a third party only basis – covering the bare essentials of insurance protection.
The problem is, insurers now don’t always offer this perk – but assuming they do catches out tens of thousands of drivers every year. 

Rising claims costs have forced insurers to cut back on certain aspects of their policies – and since driving another car was a benefit that often ended up costing the insurer money, many of them took the perk away. 

Before you jump in a car belonging to someone else, it’s absolutely vital that you check your policy to ensure you’re protected. If you’re not, you could be prosecuted for driving without insurance – and you could end up with your friend’s car being impounded.

What about rental vehicles?

When you explore the terms and conditions of your insurance policy, you’re actually likely to find that cover for rental cars is excluded from your policy. 

Even if you can ordinarily drive other vehicles on a third party only basis – this isn’t likely to be the case with a car that you’ve rented – whether that’s here in the UK, or overseas.

So, what do you do about insurance then?

Fortunately, rental companies tend to include their own cover when they let you hire a car. Most hire car insurance policies are included in the price you pay when you book – but it’s worth exploring what’s covered, as it’s not always the same level of cover you’d expect if you were buying insurance for your own vehicle. 

For example, the standard ‘damage waiver’ insurance cover that you get when you rent a vehicle often comes with a very large excess – often £500 and upwards. Some companies allow you to pay a one-off additional to reduce this excess amount significantly – and they’ll be able to talk you through the benefit of doing so when you pick your car up.  

Hire car insurance varies from company to company – so rather than leave anything to chance, it’s a good idea to research the company you’re going to use before you commit – so you can make sure there are no nasty surprises or additional costs to pay – and to double-check that you won’t be paying a fortune if you are unlucky enough to have an accident.

Other related FAQs

Looking for more related content to this? We’ve picked a selection of related topics that you may find helpful

Since car insurance policies are designed to put things right after an accident, most standard cover doesn’t protect against non-motoring criminal acts like vandalism. That said, many insurers can add vandalism cover to your policy if you’re worried about deliberate damage.

If your car insurance covers windscreen damage, it will probably also include cover for all other broken car windows, and some policies extend cover to glass sunroofs.

Comprehensive car insurance - often referred to as fully comprehensive (or ‘fully comp’) – includes cover for damage to your own car, whereas third party, fire and theft policies only cover damage to someone else’s vehicle and not your own.

As long as you have fully comprehensive cover with no exclusions relating to flood or water damage, you should find that your car insurance covers water damage. Be warned though, if the damage was avoidable (if you drove into a large puddle for instance) you might find your insurer won’t payout.

Depending on the type of car insurance you have in place, it’s likely your policy will provide cover for theft.

Most comprehensive car insurance policies will cover repair for damage caused by potholes on public roads. Alternatively, you can claim directly from the authority responsible for the road.

In most cases, your car insurance will provide cover for the cost of minor engine damage as the result of an accident, but it may not cover damage due to wear and tear.

In short, if you have comprehensive car insurance, it will pay for repairs under certain conditions.

If you have a fully comprehensive policy, you’ll generally find that insurers will pay out for severe weather damage like that caused by hail. Be warned though, not all do – so if you’re concerned, it’s important to check your policy for any exclusions.

If the cause of water damage to your car is not your fault, a comprehensive insurance policy will provide cover, but a third party insurance policy is limited and does not normally include water damage.