When we rented a car in Australia, the car rental people kept telling me to buy "additional insurance" that would reduce my "excess". They threatened that if I didn't do so, I would be charged something like US$2-3k if I got involved in any accident, regardless of fault. I have absolutely no idea what "excess" is. But I refused their sales pitch anyway, for no other reason than "if someone sells it to me, it is a bad deal."
Can someone explain the whole deal to me? What is "excess" in the insurance sense?
I know when I've rented a car they offer flood/hail insurance.
Quote from: Monoriu on March 24, 2009, 09:06:08 PMCan someone explain the whole deal to me? What is "excess" in the insurance sense?
It means that, if you're like every other Chinaman in the world, you can't drive for shit.
Excess in this context is another word for deductible (and a pretty stupid one at that, as normally excess in insurance means something close to opposite). They were offering to reduce your deductible for a price.
Quote from: DGuller on March 25, 2009, 12:54:15 AM
Excess in this context is another word for deductible (and a pretty stupid one at that, as normally excess in insurance means something close to opposite). They were offering to reduce your deductible for a price.
Which is generally a bad idea. Usually, with any type of insurance, you're best off IMO to take the highest deductible that you can. There may be special circumstances in which you'd want to decrease your deductible, but not normally.
Quote from: dps on March 25, 2009, 12:56:08 PM
Which is generally a bad idea. Usually, with any type of insurance, you're best off IMO to take the highest deductible that you can. There may be special circumstances in which you'd want to decrease your deductible, but not normally.
That is the truth. Unless you're offered heavily subsidized insurance or a freebie, it is most prudent to only insure against losses or portions of losses that you can't easily cover yourself. It also goes for extended warranties.
It is definitely not a bad idea when renting a car. It is a bad idea when insuring your own car.
With your own car you can live with scratches and scrapes here and there that accumulate over time. Rental car companies will charge you for the repair of that. I always pay the small premium to avoid any headaches when returning the car to the rental company.
American car rental insurance is a must-buy. It's cheap, and you can basically total the car.
Quote from: Scipio on March 25, 2009, 01:09:53 PM
American car rental insurance is a must-buy. It's cheap, and you can basically total the car.
If DGuller is right you can already total the car without the excess and you're still only out the deductible. So which is it?
I've always declined the coverage because I heard so many times that it's ridiculously overpriced.
If you already own a car and have regular car insurance on it - that will cover the insurance on any car you may have to rent - you only have to pay the deductible.
Quote from: PRC on March 25, 2009, 02:14:41 PM
If you already own a car and have regular car insurance on it - that will cover the insurance on any car you may have to rent - you only have to pay the deductible.
Right, what you are paying for is the right to drop off the car no matter what the condition might be. For me it is worth not having the hassle if someone hits me while I am driving a rental car (or just dings me in a parking lot). It isnt that much to have the peace of mind - which after all is what insurance is for especially when you are travelling in a foriegn country.
Quote from: Admiral Yi on March 25, 2009, 01:34:35 PM
I've always declined the coverage because I heard so many times that it's ridiculously overpriced.
I havent noticed it being much. What do you consider overpriced?
Quote from: crazy canuck on March 25, 2009, 03:12:15 PM
I havent noticed it being much. What do you consider overpriced?
Significantly more than is actuarially fair.:nerd:
Quote from: Admiral Yi on March 25, 2009, 03:13:16 PM
Quote from: crazy canuck on March 25, 2009, 03:12:15 PM
I havent noticed it being much. What do you consider overpriced?
Significantly more than is actuarially fair.:nerd:
And with that answer you're qualified to become an actuary. :D
Quote from: crazy canuck on March 25, 2009, 03:12:15 PM
Quote from: Admiral Yi on March 25, 2009, 01:34:35 PM
I've always declined the coverage because I heard so many times that it's ridiculously overpriced.
I havent noticed it being much. What do you consider overpriced?
When I rented Chevy Cobalt from Enterprise for a day, my insurance costs amounted to $30. Since I didn't have a car yet (in fact I was renting one to drive to dealerships), I didn't have my own auto policy, so I had to bend over and take it. That $30 a day for a crappy Cobalt means $900 a month, or $5400 for 6 months. As a comparison, I pay $650 for 6 months for my own car insurance now, in the same area and for a similar type of car. Do the math.
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When I rented Chevy Cobalt from Enterprise for a day, my insurance costs amounted to $30. Since I didn't have a car yet (in fact I was renting one to drive to dealerships), I didn't have my own auto policy, so I had to bend over and take it. That $30 a day for a crappy Cobalt means $900 a month, or $5400 for 6 months. As a comparison, I pay $650 for 6 months for my own car insurance now, in the same area and for a similar type of car. Do the math.
Ahh, so I was right to decline after all. I didn't do any math. I reacted instinctively - the answer to anybody selling any type of insurance to me should be no.
Another thing is, I'll not be financially ruined if I need to pay the excess.
Yep, the added coverage is basically pure profit for the rental agency. Offering it is scare tactics. Most credit card companies cover that as a matter of course (all of mine have), so declining the extra coverage should be automatic.
Quote from: grumbler on March 25, 2009, 07:10:52 PM
Most credit card companies cover that as a matter of course (all of mine have), so declining the extra coverage should be automatic.
I didn't know that. I'll have to see if that is true for cards issued in HK.
Quote from: Monoriu on March 25, 2009, 07:05:55 PM
Ahh, so I was right to decline after all. I didn't do any math. I reacted instinctively - the answer to anybody selling any type of insurance to me should be no.
Another thing is, I'll not be financially ruined if I need to pay the excess.
I agree mostly, but you do have to be careful with auto insurance, because the sums involved can be life-ruining. You do have to make sure that large deductible is all you really are on the hook for if Mrs. Mono turns the standard sedan into a compact.
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I agree mostly, but you do have to be careful with auto insurance, because the sums involved can be life-ruining. You do have to make sure that large deductible is all you really are on the hook for if Mrs. Mono turns the standard sedan into a compact.
I've rented cars in Japan, Hong Kong and Australia. Only in Australia is the extra insurance offered.
But you are not paying 30 bucks a day for a year. You are paying 30 bucks a day for bridge insurance.
Quote from: crazy canuck on March 26, 2009, 09:56:08 AM
But you are not paying 30 bucks a day for a year. You are paying 30 bucks a day for bridge insurance.
What's the difference?
Quote from: DGuller on March 26, 2009, 10:31:12 AM
Quote from: crazy canuck on March 26, 2009, 09:56:08 AM
But you are not paying 30 bucks a day for a year. You are paying 30 bucks a day for bridge insurance.
What's the difference?
$10,770.
If you guys want to fool with deductables, your insurance company and foriegn laws if you get into a trouble with a rental car in foreign company that is of course your perogative. But I prefer to pay to just drop off no matter what has occurred.
Quote from: crazy canuck on March 26, 2009, 10:44:09 AM
Quote from: DGuller on March 26, 2009, 10:31:12 AM
Quote from: crazy canuck on March 26, 2009, 09:56:08 AM
But you are not paying 30 bucks a day for a year. You are paying 30 bucks a day for bridge insurance.
What's the difference?
$10,770.
If you guys want to fool with deductables, your insurance company and foriegn laws if you get into a trouble with a rental car in foreign company that is of course your perogative. But I prefer to pay to just drop off no matter what has occurred.
Maybe, but that doesn't change the original point. Insurance offered by rental companies is almost pure profit, and often completely unnecessary (meaning that it provides redundand coverage). Just because you're raped hard, but only for a couple of seconds, doesn't mean that you weren't raped.
Quote from: DGuller on March 26, 2009, 11:04:03 AM
Quote from: crazy canuck on March 26, 2009, 10:44:09 AM
Quote from: DGuller on March 26, 2009, 10:31:12 AM
Quote from: crazy canuck on March 26, 2009, 09:56:08 AM
But you are not paying 30 bucks a day for a year. You are paying 30 bucks a day for bridge insurance.
What's the difference?
$10,770.
If you guys want to fool with deductables, your insurance company and foriegn laws if you get into a trouble with a rental car in foreign company that is of course your perogative. But I prefer to pay to just drop off no matter what has occurred.
Maybe, but that doesn't change the original point. Insurance offered by rental companies is almost pure profit, and often completely unnecessary (meaning that it provides redundand coverage). Just because you're raped hard, but only for a couple of seconds, doesn't mean that you weren't raped.
But the point is, it isnt redundant and especially if you are travelling in a foreign country.
Assuming the best possible scenario where you have a low deductable, some kind of coverage already in place (including credit card coverage) and the foresight to bring all that documentation along with you for easy reference, that fact remains that if you try to return that vehicle with damage the rental car company will demand immediate payment which might require time to assess the damage (delaying you) and which payment your insurers might in due course deem to have been excessive.
Like I said I prefer to pay a premium to avoid all of that considering that the price is low for the convenience it buys me.