Stolen rental car

What you need to do if your rental car is stolen.

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If your rental car is stolen while in your custody, your dream holiday can quickly turn into a nightmare. Not only is a stolen rental car a stressful experience, it can also be an expensive one if you don’t have the right insurance cover in place.

So what should you do if your hire car is stolen and how can insurance help? Let’s find out.

Want to know a hack? Car rental excess insurance is your best mate

NameInternational or domestic coverEligible driver ageFeaturesStarting price (per day)Apply
Rental cover logo

Both19–99 years
  • Complete vehicle coverage for up to $100,000 in damages
  • Coverage for theft, towing, damage to tyres, windscreens, roof, underbody, and key loss
  • Coverage for accident-related charges e.g. admin/processing fees, "loss of use", relocation fees, and more
  • Cancel anytime up until pickup, and for any reason
  • No further excess payable
$9.48 ($0 excess)Get quote
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Car hire excess

Both21–75 years
  • Cover from $4,000 to $8,000
  • Additional cover for damage to windscreens, roof, tyres and underbody
  • Underwritten by Lloyds
  • No further excess payable
$9.30 ($0 excess)Get quote

*Prices are based on a 15-day hire in Australia, as of September 2019. Benefits vary from brand to brand. Always read through the product disclosure statement (PDS) to make sure the product is suitable for you.
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What should I do if my rental car is stolen?

Make sure you follow a few simple steps:

  1. Report the theft. The first step is to report the theft to the police immediately. This is essential for insurance purposes, so make sure you get a copy of the report, and also to maximise the chances of the vehicle being tracked down. Remember to also inform the police if any of your valuables were in the vehicle when it was stolen so that they are included in the report.
  2. Contact the car hire company. Once you’ve notified the police, contact the car rental company as soon as possible to let them know what has happened.
  3. Gather your documents. Keep copies of the police report and any receipts/valuations of your personal items that were in the car when it was stolen. This will come in handy at a later date when determining whether your insurance provider will cover you.

What’s the rental car insurance excess?

In Australia and New Zealand, if a rental car is stolen, damaged or involved in a collision while in your possession, you won’t have to pay the full cost of replacing the car. However, you will be liable to pay an insurance excess. This excess is your financial liability for theft or damage to the car, and while the excess amount charged varies between car rental providers, it could be anywhere between $2,000 and $6,000.

That’s a significant liability to have hanging over your head, but that’s how much you could potentially be left out of pocket if your rental car is stolen. However, the good news is that there are simple ways to reduce this excess or even eliminate it altogether.

The insurance excess situation may also be a little different in different countries around the world. For example, in the United States, the loss damage waiver (which covers theft, collision, vandalism and loss or damage due to a range of other causes) is optional for US citizens, but is often optional for inbound travellers.

How can I reduce or avoid the car rental insurance excess?

There are a few insurance options you can purchase in advance to reduce your liability in the event that your rental car is stolen or damaged:

  • Excess reduction cover. When you pick up your rental car, it’s common practice for the rental agency to try to sell you its excess reduction product. By paying a daily premium for the duration of the rental period, you can lower your financial liability in the event of an accident or theft – for example, your excess could be reduced from $3,000 to $300. However, this type of insurance is quite expensive.
  • Travel insurance. Many (but not all) comprehensive travel insurance policies include car rental excess cover as a standard benefit. This provides a benefit, up to a specified limit, such as $4,000 or $6,000, to cover the excess charged by the hire company. Not only is travel insurance usually cheaper than the rental company’s excess reduction insurance but it also comes with a wide range of other benefits to provide protection throughout your trip. If your credit card includes complimentary travel insurance, you might also want to check whether the car rental excess is covered by your policy.
  • Standalone car rental excess cover. The third option is to buy standalone car rental excess insurance direct from an insurance provider. Unlike travel insurance, these policies are specifically designed to cover you when you hire a car, and they’re also much more affordable than the product the rental company will try to sell you.

You can find out more about your car rental excess cover options in our comprehensive guide.

How to make sure you’re covered

Keep the following tips in mind to ensure that you have the right cover in place in case your rental car is stolen:

  • Check the rental agreement. Excess reduction insurance most likely won’t cover you if you breach the terms of your rental agreement, so make sure you’re fully aware of your responsibilities when renting a car. For example, did you know that taking your rental car on an unsealed road could potentially void your insurance coverage?
  • Check the list of exclusions. You should also check the fine print on your insurance policy to find out exactly what is and isn’t covered. For example, excess reduction cover from the car hire company may not include cover for windscreen or tyre damage.
  • Make sure your vehicle is covered. Check the fine print of your policy to make sure the type of vehicle you plan on renting is eligible for cover.
  • Specify your country. To ensure that you get an accurate online quote when booking a rental car overseas, make sure you specify your country of origin. This is because depending on where you are travelling, rental vehicle insurance may be a mandatory requirement (and part of the daily fee) for foreign citizens.

Hopefully you never experience the stress and emotional trauma of a stolen rental car. However, by planning ahead and taking out the right insurance cover, you can make sure you’re protected should the worst happen.

Picture: Shutterstock

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