Whether you’re taking your own car overseas or hiring a car when you get there, you legally must have insurance. But be aware that it’s easy to spend too much on unnecessary car hire cover, and the excess can be very high. Find out how to avoid the pitfalls and get a suitable deal.
Is my car insured abroad?
If you’re going on a trip where you plan on driving your own car, it’s important that you have the right insurance. Most UK comprehensive car insurance policies will include cover for driving within the EU and the EEA (European Economic Area).
If you’re driving your own car outside of Europe, you might need to buy separate insurance cover and apply for an international driving permit for the destinations you're visiting.
When you take your own car abroad, it’s a good idea to bring along:
- your driving licence and vehicle registration documents (V5C).
- If you’re planning on driving in the EEA and you have a paper driving licence, you’ll need to get an international driving permitOpens in a new window You can buy one from the Post Office for £5.50.
- proof of insurance, such as a printed or electronic PDF copy of your insurance certificate.
To find out more about driving abroad and to stay up-to-date with Brexit-related changes go Opens in a new window on GOV.UK
For a list of European Economic Area countries goOpens in a new window to GOV.UK
What insurance do I need when hiring a car abroad?
Make sure you’ve got the right documents
You’ll need to bring your UK photo driving licence or show an international driving permit (IDP). In the EU and EEA your UK photo driving licence is valid and it is no longer required to show a green card.
Check the GOV.UK site for which type of IDP you needOpens in a new window to drive in different countries.
Check what’s included in the car hire
The car hire company will include the minimum level of cover needed to legally drive the car in your hire cost. This will be a similar level to third party insurance, and you’ll be covered if the vehicle gets stolen. You’ll still have to pay excess if there’s a claim. These charges can be high so check your paperwork for the excess amount.
You can buy insurance to cover excess payments in the event of a claim, but these can be quite expensive if purchased from the hire company.
Understanding credit card pre-authorisation
Car rental agreements usually include an authorisation allowing the rental company to charge your credit card for extra items.
This is why you usually have to show your credit card at the desk when you pick up your hire car.
The car hire company can take a payment from your card without telling you or getting your permission.
In theory, a car rental company might charge you the full ‘excess’ amount for even minor damage to the car.
It's important to check the car thoroughly and record every scratch and mark. You can take a video of all angles of the car before you drive away and again when you return it to the hire company in case there are any disputes. When you take it back, make sure the hire company signs and records every mark so you both agree the condition it was returned in.
Check the small print
Read all terms and conditions online before you buy. Although sometimes the full documentation is only available at the desk when you go to pick up the car.
Check that you’re covered for unlimited daily mileage if you’re travelling long distances.
Check your credit card statement at the end of your travels to make sure there are no unexpected charges. If there are any charges you want to dispute, report them to both the hire company and your credit card provider – who will help resolve this for you.
Watch the excess on your hire car insurance
Most car hire companies charge a very high excess if the car is damaged or stolen – between £500 and £1,500. Excess is an amount you’ll be charged or will be taken off your payout when you make a claim on your insurance. They can potentially charge you a very large amount for even small scratches.
Consider taking out excess insurance
You can always cover yourself by buying excess reimbursement insurance. This means you can claim your excess back – if you’re charged. This is also known as standalone car hire insurance. You can buy it online from brokers and comparison sites.
It covers things not usually included in any top-up insurance, such as tyre damage or lost keys. Although you can’t normally get it for very expensive cars or camper vans.
There are two kinds of cover:
- daily policy, which starts at around £3
- annual policy from around £39 – it’s often good value for a fortnight or more.
Don’t buy ‘top-up insurance’ from the car hire firm
Your car hire company will try to sell you top-up insurance – which reduces your excess to zero.
This is also known as ‘super collision damage waiver’, ‘deductible cover’ or ‘non-waiver cover’.
This top-up insurance is very expensive – around £10 a day.
It tends to exclude theft, vandalism, damaged tyres, lost keys and use of wrong fuels. It can be poor value for money but it will avoid any arguments when you return the vehicle as any damage should automatically be covered by their own policy.
