Understanding the Terms and Charges
Ask about any additional charges before you sign your rental agreement. The information may
help you save money and avoid disputes when the time comes to pay your bill.
Collision Damage Waiver (CDW), in states that allow it, is an optional charge of $9 to $13 a
day. Rental car agents may urge you to buy this option. Although they call it "collision damage"
coverage, it's not technically collision insurance. Rather, it is a "guarantee" that the rental
company will pay for damages to your rented car. By declining the waiver, you accept
responsibility for any damages. However, under CDW, the company will not pay for bodily injuries
or damages to your personal property. If you do not buy CDW coverage or are not covered by
your personal auto insurance policy, you could be liable for the full value of the car. Some rental
companies may hold you liable only for the first $1,000 or $2,000.
Some CDWs exclude coverage under certain circumstances. For example, coverage may be
revoked if you damage the car when driving it in a negligent manner, on unpaved roads, or out
of the state in which you rented the vehicle. Some companies void their CDW coverage if a driver
drinks alcohol or if a non-authorized driver operates the car.
The coverage offered by rental car companies may duplicate insurance you have through your
auto and homeowner's policies. Coverage under your medical plan would offer protection that
CDW coverage lacks. Read your insurance policies and medical plan for specifics. If you're not
sure about the coverage, call your insurers. If you're traveling on business, your employer may
have insurance that covers you. Also, some credit card companies and motor clubs provide
members with free rental protection when you use their cards to pay for rentals.
In addition to CDW coverage, a rental car company also may offer:
Personal Accident Insurance (PAI). At a daily cost of $1.50 to $4, it pays a death benefit and a
portion of your medical expenses if you're in an accident.
Personal Effects Coverage (PEC) or Personal Effects Protection (PEP). At an average daily
cost of $1.25, it safeguards your luggage against damage. If your homeowner's policy covers
your luggage and other belongings while you travel, you may not need this protection.
A refundable charge may be required when you pick up your rental car. The charge varies, but
may be hundreds of dollars. Most rental companies make the charge to your credit card but do
not process the amount unless you do not return the car as specified in your rental contract.
N.B.Until you return the car, however, your spending limit on your credit card may be reduced by
the amount of the deposit. This may be important if you plan to charge other items to your credit
card and are near your credit limit. If you do not have a major credit card, or you do not want to
charge the deposit, companies may ask for the deposit in cash.
Airport surcharges and drop-off fees can increase the base rental rate considerably.
Surcharges apply when airport authorities impose fees for airport use even when rental car
companies shuttle you to an off-airport site. Drop-off fees refer to charges that some companies
impose to allow you to drop off the car at a different location from the pick-up point.
A fuel charge is the amount many rental car companies add to your bill for gasoline. Some
companies give you a half-tank at a charge of $10 to $15 and tell you to return the car empty;
others fill the tank and charge for the amount of gas you use. Companies that do not charge for
the initial tank may ask you to return the car with a full tank. If you don't, you'll be charged the
rental company's price for gasoline. It's often much higher than a local station.
Mileage fees usually are assessed on a cents-per-mile basis or as a flat fee when you exceed
the allotted free mileage cap. Knowing approximately how far you will drive will allow you to
select the company that offers the most favorable mileage terms.
Taxes are levied by states and some municipalities. You may be able to avoid the higher tax rate
of an urban pick-up site if you pick up your rental car at a suburban location.
Additional-driver fees and underage-driver fees are costs a company assesses when you
share the driving with another person or when a driver is under a certain age (often 25).
Out-of-state charges are assessed when you drive the car out of the state in which it was
rented.
Equipment-rental fees are imposed when you order extras such as ski racks and car seats. If
these items are important to you, make sure you reserve them in advance.
Return To Car Rental
Ask about any additional charges before you sign your rental agreement. The information may
help you save money and avoid disputes when the time comes to pay your bill.
Collision Damage Waiver (CDW), in states that allow it, is an optional charge of $9 to $13 a
day. Rental car agents may urge you to buy this option. Although they call it "collision damage"
coverage, it's not technically collision insurance. Rather, it is a "guarantee" that the rental
company will pay for damages to your rented car. By declining the waiver, you accept
responsibility for any damages. However, under CDW, the company will not pay for bodily injuries
or damages to your personal property. If you do not buy CDW coverage or are not covered by
your personal auto insurance policy, you could be liable for the full value of the car. Some rental
companies may hold you liable only for the first $1,000 or $2,000.
Some CDWs exclude coverage under certain circumstances. For example, coverage may be
revoked if you damage the car when driving it in a negligent manner, on unpaved roads, or out
of the state in which you rented the vehicle. Some companies void their CDW coverage if a driver
drinks alcohol or if a non-authorized driver operates the car.
The coverage offered by rental car companies may duplicate insurance you have through your
auto and homeowner's policies. Coverage under your medical plan would offer protection that
CDW coverage lacks. Read your insurance policies and medical plan for specifics. If you're not
sure about the coverage, call your insurers. If you're traveling on business, your employer may
have insurance that covers you. Also, some credit card companies and motor clubs provide
members with free rental protection when you use their cards to pay for rentals.
In addition to CDW coverage, a rental car company also may offer:
Personal Accident Insurance (PAI). At a daily cost of $1.50 to $4, it pays a death benefit and a
portion of your medical expenses if you're in an accident.
Personal Effects Coverage (PEC) or Personal Effects Protection (PEP). At an average daily
cost of $1.25, it safeguards your luggage against damage. If your homeowner's policy covers
your luggage and other belongings while you travel, you may not need this protection.
A refundable charge may be required when you pick up your rental car. The charge varies, but
may be hundreds of dollars. Most rental companies make the charge to your credit card but do
not process the amount unless you do not return the car as specified in your rental contract.
N.B.Until you return the car, however, your spending limit on your credit card may be reduced by
the amount of the deposit. This may be important if you plan to charge other items to your credit
card and are near your credit limit. If you do not have a major credit card, or you do not want to
charge the deposit, companies may ask for the deposit in cash.
Airport surcharges and drop-off fees can increase the base rental rate considerably.
Surcharges apply when airport authorities impose fees for airport use even when rental car
companies shuttle you to an off-airport site. Drop-off fees refer to charges that some companies
impose to allow you to drop off the car at a different location from the pick-up point.
A fuel charge is the amount many rental car companies add to your bill for gasoline. Some
companies give you a half-tank at a charge of $10 to $15 and tell you to return the car empty;
others fill the tank and charge for the amount of gas you use. Companies that do not charge for
the initial tank may ask you to return the car with a full tank. If you don't, you'll be charged the
rental company's price for gasoline. It's often much higher than a local station.
Mileage fees usually are assessed on a cents-per-mile basis or as a flat fee when you exceed
the allotted free mileage cap. Knowing approximately how far you will drive will allow you to
select the company that offers the most favorable mileage terms.
Taxes are levied by states and some municipalities. You may be able to avoid the higher tax rate
of an urban pick-up site if you pick up your rental car at a suburban location.
Additional-driver fees and underage-driver fees are costs a company assesses when you
share the driving with another person or when a driver is under a certain age (often 25).
Out-of-state charges are assessed when you drive the car out of the state in which it was
rented.
Equipment-rental fees are imposed when you order extras such as ski racks and car seats. If
these items are important to you, make sure you reserve them in advance.
Return To Car Rental
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Car Rental
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Online carefree travel service for festivals, special events, villa and vacation home rentals, vacation packages,
tours, family vacations and travel with pets. Plan your trip, book online and enjoy a carefree vacation with The
Carefree Traveller. Travel guides, maps and travel store.
tours, family vacations and travel with pets. Plan your trip, book online and enjoy a carefree vacation with The
Carefree Traveller. Travel guides, maps and travel store.