Do you want to know, what is CDW insurance in car rental contract? You are on the right spot to know the answer of this question.
Many times when we rent cars, we find many terms in the contract that we do not understand. One of these terms is CDW insurance, which stands for “Collision Damage Waiver”, and means “Collision Damage Waiver”.
In this article we explain what it is, how CDW insurance works and what other options you have to insure your rental car.
What Insurance do I have when Renting a Car?
The insurance that is included in the rental car contract is third-party liability, that is, in the event of an accident in which you are at fault, the insurance covers the damage to the other vehicle involved, and you have to charge of the full repair costs of the rental car.
See Also: Reason to Rent a Car with Fully Comprehensive Insurance
If you want to extend this coverage, rental companies offer CDW insurance or comprehensive insurance with excess, for an amount per day of rental.
This insurance has an associated excess that is predetermined in the contract and in the event of damage to the vehicle, you will have to pay said excess and the insurer will be responsible for the rest of the cost of the repair.
How does CDW Insurance Work?
CDW insurance covers damage to the rental car in the event of an accident, such as a collision with another vehicle or with urban furniture. The car rental company is responsible for the repair charges, except for the agreed excess.
Having contracted the CDW insurance, if the rental car contract has an excess of 500 Dollars and the lessee has an accident in which the repair of the vehicle amounts to 1,200 Dollars.
The payment of this claim will be divided as follows: the driver of the rental car will have to pay the first 500 Dollars and the insurer will take care of the remaining 700 Dollars.
CDW coverage covers almost all parts of the car in the event of an accident, with a few exceptions, depending on the car rental company. Most of these companies cover the body of the vehicle, but do not cover:
- Tires
- Crystals (windshield, mirrors and windows)
- tires
- Lost keys
- Underbody of the vehicle
If you want to have these areas of the rental car insured, you can contract specific coverage with the company itself, for an amount per day of rental or contract additional insurance.
Can I eliminate the CDW Insurance Deductible?
Yes, the rental car insurance excess can be eliminated. In rental companies they have another term known as SCDW, that is, “Super Collision Damage Waiver”.
This insurance covers damage to the vehicle, eliminating the deductible for which the driver is responsible.
See Also: How to Get Car Insurance in Pakistan
As with CDW insurance, you have to pay extra to have this coverage and in the end, having comprehensive insurance is equal to or more expensive than renting the vehicle itself.
And although you eliminate the excess with the SCDW insurance, there are parts of the car that are still not insured in the event of an accident, such as the rims, glass, tires or underside of the vehicle.
There are other options to eliminate the rental car franchise such as additional insurance. The additional insurance of Car Rental Insurance eliminates the excess of the vehicle for a lower price, up to 80% cheaper than that offered by the car rental companies themselves.
In addition to being cheaper, it has the most complete coverage, including damage to the windows, tires or the underside of the vehicle, among other coverage.
LDW insurance
Another term that we come across when renting a car and is associated with insurance is LDW insurance.
It comes from the English term “Loss Damage Waiver”, and means “Exemption of damages for loss”.
This means that you are covered, except for the agreed excess, for damages that have occurred in the vehicle due to total or partial theft of it.
LDW insurance, like CDW insurance, is supplemental insurance often offered by car rental companies to extend third-party liability coverage.
Do I need CDW Insurance when Renting a Car?
It is difficult to know what will happen when you rent the rental car, you will have to weigh the pros and cons of taking out insurance. But it is always better to have insurance and not need it than not to have it and need it.
When you make a trip with a rental car, the best option is to take out comprehensive insurance.
In this way you will not have any surprises or extra expenses when returning the vehicle at the car rental office.
Remember that, even if you extend the coverage with the company, there are situations that are not covered, such as damage to the tires, the windows, the chassis or the error when refueling.
