# Rental cars in Australia



## james4beach (Nov 15, 2012)

ian said:


> We will be flying home from Sydney in mid/late March.


ian, I am curious if you've rented a car in Australia? The rental agencies try to get people to pay for "excess reduction" (ER) which reduces the deductible, in case of damage, from something like $4000 down to $500 or so. All car rentals in Australia have mandatory collision/loss/damage coverage, it's just that there's a high deductible so you could (in a worst case) still be charged thousands.

I'm thinking that ER should be unnecessary if there is collision/damage insurance on a credit card. After all, this is how I'm always renting in North America. If there was any serious damage, the rental agency in e.g. Toronto might charge thousands to my CC and then I'd recover this via the CC insurance so that's how I'm used to renting, routinely.

My feeling is that renting in Australia, one should decline ER. They automatically cover 3rd party liability anyway. What are your thoughts? Or anyone else who's rented in Australia?


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## 319905 (Mar 7, 2016)

Off topic ... reminds me maybe ... yikes, almost 20 years ago ... landing in Canberra late one night, the airport was empty, found the car rental kiosk, there was a note addressed to me/papers on the counter ... the keys are on the shelf behind the counter. Two or three circles around the lot and off I went, first time driving on the left, through a few roundabouts to the hotel downtown Canberra ... perfect


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## ian (Jun 18, 2016)

On our last trip, three years ago, we had two rentals. We declined extra coverage though some was included in the base rate. Our credit card coverage directs us to refuse extra coverage.

We just arranged a 7 day rental for March in Tasmania. We took the basic. We rented through autoeurope.ca, as we have before. The first reservation went through at $300 for a week. The second time I checked we rebooked since it went down to $241. Rebooked last week for $201 with an upgraded car. We have dealt with autoeurope many times. We once had an issue with agency billing. Autoeurope resolved it immediately. We may reserve a car for the Gold Coast later this week.

Some of the autoeurope rentals that we have had in Italy, Greece, and Turkey came with extra insurance included in their base rate-no option. Not sure if it depends on the country or the rental agency.

Some agencies do try and upsell. I have no problem saying no. Costa Rica was a nightmare. I actually had our auto insurance agent in Canada send an email to the rental agency (as we waited) in order to get their ridiculously expensive insurance option waived. Budget at LAX is notorious for trying to upgrade cars and insurance. We found National to be the same. I assume their rental agents get a healthy commission on upsells.

I made the mistake of renting a car at Gold Coast Airport one morning after getting off a ten hour flight from Malaysia. Fortunately we were not driving far. In hindsight I realize that this was not very smart. I was tired, distracted, and had to drive on the other side of the road, which included roundabouts. It turned out OK but I should not have done this. Will not make the same mistake this year.


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## james4beach (Nov 15, 2012)

Just clarifying though, in Australia everyone gets collision/loss insurance and can't opt out; the question is the deductible amount. Let's say your rental car was in an accident and the immediate estimates are for $4k in repairs. The default deductible (they call it "excess" in AU) is around $4k so you would actually see the full $4k charged to your card.

Reading forums for Aussie rentals, it sounds like everyone tends to buy the Excess Reduction which reduces that deductible significantly. It sounds like you, ian, are not buying this extra protection -- and I don't plan to either. Are you comfortable with the possibility of seeing several thousand $ charged to your cc for repairs?

But what do you think are the main reasons people buy it? Is it because they absolutely don't want 4k charged to their card? Or is it the hassle of filing an insurance claim through cc. I ask this because it's not obvious to me why everyone is buying the extra coverage (Excess Reduction in AU) even though their cc includes the insurance.

I want to make sure I'm not missing a good reason to buy the rental agency's Excess Reduction.


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## Longtimeago (Aug 8, 2018)

I think you should talk to your CC rental car insurance provider. The actual insurer themselves, not the CC company.

The thought occurs to me that while your CC may provide 'collision/damage' coverage, that MAY not apply to the deductible. In other words, they might say, 'oh yes, the Australian rental company charged you $10k for the accident you were involved in. Their $4k deductible and the additional $6k above that that the repairs cost. We cover you for all 'repair costs' that a rental company charges you above the 'deductible'. 

So the question is will your CC insurance provider cover the deductible and/or only apply their own deductible and if it is the latter, what is their deductible? I wouldn't expect anyone from your CC company to answer that question, I would want to ask the insurer.

A quick Google got me this article which outlines some other 'additional costs' that can be charged and that some may or may not be covered by your CC insurer. It even shows that American Express excludes Australia from their coverage. So all the more reason I would say to talk to the insurer and READ the CC insurance policy in its entirety.
https://www.creditcards.com/credit-card-news/car-rental-insurance-coverage-1273.php

What someone else experienced is of no consequence if you have a different insurer obviously.


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## ian (Jun 18, 2016)

We are covered for this. We have been through it several times. Most of the counties we visit are on the ok list. We only rent small cars. No trucks, suv's, vans, or luxury vehicles. Some of the exclusions that we have seen in the past are very odd. Also, some differences between what US issued cards and what Canadian issued cards exclude.

You never know what will happen. When we did daily rentals on a few of the smaller Greek Islands we filled out the forms, provided our credit card, etc. When we returned, they checked the car for damage. Then we went into the office. The had previously asked for cash. They ripped up their copy of the rental agreement and handed it to us. We gave them the 25 euro rental charge in cash.


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## Longtimeago (Aug 8, 2018)

ian said:


> We are covered for this. We have been through it several times. Most of the counties we visit are on the ok list. We only rent small cars. No trucks, suv's, vans, or luxury vehicles. Some of the exclusions that we have seen in the past are very odd. Also, some differences between what US issued cards and what Canadian issued cards exclude.
> 
> You never know what will happen. When we did daily rentals on a few of the smaller Greek Islands we filled out the forms, provided our credit card, etc. When we returned, they checked the car for damage. Then we went into the office. The had previously asked for cash. They ripped up their copy of the rental agreement and handed it to us. We gave them the 25 euro rental charge in cash.


As I happened to live on a Greek island for several years ian, your example comes as no surprise to me. Whenever someone talks about anything and then includes Greece, the response is always the same. 'This is Greece we are talking about.' Meaning, all laws and rules are meaningless and any assumptions you might make are also meaningless.

In Greece, there are countless small independent rental companies as well as the usual suspects like Avis, Hertz, etc. The big companies play by the rules, the small independents often do not. That is why in Greece, you always want to check that you have a rental agreement and that it does include insurance. Some will try to rent without either. But more common is a transaction such as you describe.

There was a rental contract and insurance coverage. However, they did that only in case you had an accident and they had to file a claim on the insurance. Having seen there was no damage and no need for them to make a claim, they then 'ripped up' the contract and took cash. In fact, you were participating in an illegal transaction. The only intent of what they did was to avoid reporting the income and thus avoiding paying tax on the income. Your rental never happened.

It is always important with any kind of insurance to read the contract in full and understand it. Anything you don't understand you should ask the insurer to clarify for you. Exclusions often trip up travellers simply because they did not read and understand their policy details. A woman hangs her purse on the arm of her chair in a restaurant. Someone steals it while she is distracted. Not covered. Theft coverage specifically says (pretty much in every insurance policy) that you must take 'due care'. She didn't take due care, claim denied.

Driving off the highway on a dirt road often gets people a surprise bill when something goes wrong. They hit a rock and hole the gas tank perhaps. 'But I was driving in a National Park on a designated road'. How many people do you imagine may have done this on a visit to a National Park and never realized what they were risking? I'm not saying they all got a big bill, I'm just saying they risked a big bill without even knowing it.

Read number 3 in this link: https://www.moneycrashers.com/rental-car-insurance-coverage-credit-cards/

It shows that if you read your CC insurers policy it might not show 'no dirt roads' as such. But it will show that they will exclude coverage if you 'void your rental contract'. The rental contract says 'no dirt roads'. So your CC insurer will deny the claim not on the basis of you having driven on a dirt road being against their policy, but on the basis of you having violated your 'rental contract'. 

I bring up that example ian for readers to see that even though they may not find an 'exclusion' on their CC insurance policy itself, it does not mean they are covered because it is not excluded. That may seem sneaky to some but all it really means is you must UNDERSTAND the policy.


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## ian (Jun 18, 2016)

Good comments about the exclusions. We drove the back road to Hana and were aware that damages would not be covered by the rental company.

As for rental agencies on Greek Islands...two of them were well known international car rental agencies. We pre reserved through one of them. They turned out to be the best. Business was slow (during the economic troubles) so we were given the choice of any car on the lot (chose a very nice Alfa Romeo).

One always risks a bill, particularly where we live. Cracked windshields are common. The worst part of the business can be an untoward rental franchise. The was, and probably still is, one at Vancouver Airport that his been the subject a numerous media cover stories. International brand, extremely well know, whose franchisee focuses on finding damages and charges luckless renters. 

We did a rental in Faro, Portuagal. The agent spent 15 minutes on an insurance upsell. Turns out that after 15 minutes of discussion we find that the only thing that was not covered was the radio antena and the hubcaps. We unscrewed the antena and put it in the trunk. Oddly enough we were told that this is a common target for thieves! We did loose a hubcap in Costa Rica. Fortunately the agency was come day go day. They could not have cared less.

Much of my career in the last 15 working years was composing, reading, understanding, and negotiating contracts. My experience is that it takes two or three reads to truly understand where the pitfalls and gaping holes are. That is where the profit, the loss, the risk, and the opportunity live.


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## james4beach (Nov 15, 2012)

ian, in another thread you mentioned you used the Home Trust card. Is that what you use in Australia for car rentals? That's the one with the RSA insurance.

And if indeed you are using the same Home Trust Preferred as I am in Australia, when you say you're covered, do you mean that this HT w/ RSA insurance does in fact apply towards the excess (deductible)?

Regarding the road to Hana: is the recommended path, around the north side of the island (and then returning the same way) fully eligible for insurance, such as with the cc insurance? I thought that road was fully sealed/paved. Or is even that route not covered, for some reason?

P.S. sounds like we have similar vacation habits


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## gibor365 (Apr 1, 2011)

> We have dealt with autoeurope many times. We once had an issue with agency billing. Autoeurope resolved it immediately.


 we also always rent via autoeurope. Excellent provider and and very good customer service. Highly recommended

We always use CIBC Dividend Visa .... imho more reliable than HT Visa. Chip on my HT Visa got corrupted twice in last 6 months..(have/had another 5-6 CC and it never happened).. just today ordered replacement card. Imagine that chip got corrupted when you need to pay in other country! You will need to use another card and you CC coverage would be voided.


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## nobleea (Oct 11, 2013)

james4beach said:


> Regarding the road to Hana: is the recommended path, around the north side of the island (and then returning the same way) fully eligible for insurance, such as with the cc insurance? I thought that road was fully sealed/paved. Or is even that route not covered, for some reason?


Yes, the road to hana around the north side is paved and safe for rentals. Lot of blind corners and narrow bridges and the whole thing is only two vehicles wide. I thought it was a fun drive, but others find it extremely stressful.


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## Longtimeago (Aug 8, 2018)

Rental car stories can be fun. I've never really had a bad rental car experience where they say there is damage etc. and you get hit with a bill. I do know such things do happen but touch wood, none have ever happened to me so far.

I do have to admit though that as I share what I believe is a commonly held belief that car rentals are not done on a 'win/win' basis by the rental companies in general, I have on occasion resorted to some 'shady' practices in dealing with them.

I'm going to start a new thread on the General Discussion section of the forum as I think it can be a fun subject to share some stories about. Give it a look if my referring to my have adopted some 'shady' practices has you curious.


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## ian (Jun 18, 2016)

james.....

Yes, I am using a Home Trust Preferred card for my Australia car insurance. I did not receive a certificate of insurance in my welcome package from Home Trust (they will send me one).

But, I did call RSA @ 1 800 835 5154. They confirmed coverage. 

This is good. While we are gone for two months our car sits in the garage. We cancel the insurance with the exception of fire/theft. Saves a few bucks.


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## james4beach (Nov 15, 2012)

Thanks ian. I also saw your warning about the PIN in the other thread. Ouch...


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