Do I need insurance to rent a car?
Yes, you need insurance to rent a car, but the essentials are usually included in the hire cost.
Every rental car in the UK must have third-party liability insurance by law, covering damage or injury to others. What isn’t automatically included, however, is full protection for the vehicle itself or for you as the driver, and that’s where confusion (and extra costs) often begin.
When you book online, the price often looks competitive until you reach the rental desk and face a stack of add-on offers: collision damage waiver, theft protection, excess cover, personal accident insurance. Most travellers aren’t sure what they already have, what’s legally required, or what’s just a sales tactic. The result? Many either pay for overlapping policies or decline valuable protection without realising it.
If you’re hiring a car for a weekend in Manchester, you’re likely covered by the basic legal minimum. But if you’re driving across Europe or renting a premium vehicle, gaps in coverage could expose you to thousands in repair or medical costs. Understanding which insurance applies, what’s included, and what’s optional will help you rent confidently, without unnecessary add-ons or nasty surprises later.
This guide breaks down exactly what insurance is included when you rent a car, why you might still need more, and how to check your existing policies before you pay a penny extra.
What insurance is automatically included when you rent a car?
Every rental car in the UK includes at least third-party liability insurance, which covers damage or injury you cause to other people or property.
Most rental companies also include two additional protections, Collision Damage Waiver (CDW) and Theft Protection, but both come with high excess charges and exclusions you should understand before driving away.
Third-party liability insurance is the legal minimum, required by UK and EU law. It protects you if you injure someone or damage their property while driving the hire car. However, it doesn’t pay for damage to the rental vehicle itself. That’s where CDW and Theft Protection step in.
The Collision Damage Waiver limits how much you’ll pay if the car is damaged, typically leaving you responsible for an “excess” of between £500 and £2,000. The Theft Protection element works similarly, covering loss or theft of the car but still leaving you liable for an excess if the vehicle is stolen.
These inclusions are meant to provide a basic safety net, but they’re not full insurance in the traditional sense, they’re waivers that limit, not eliminate, your financial risk.
Some companies also include roadside assistance or limited windscreen and tyre cover, though these vary by provider and country.
| Type of Cover | What It Protects | Typical Excess (UK) |
|---|---|---|
| Third-Party Liability | Injury or damage to others | £0 (mandatory) |
| Collision Damage Waiver (CDW) | Damage to rental car | £500–£2,000 |
| Theft Protection | Theft or attempted theft of car | £500–£2,000 |
| Optional Extras | Windscreen, tyres, roadside assistance | Varies by provider |
If you’re hiring abroad, remember that coverage definitions and limits differ between countries. In the United States, for example, basic liability cover may not be included at all, leaving UK travellers unexpectedly exposed unless they arrange additional protection in advance.
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Get QuotesWhy might you still need additional car rental insurance?
You might still need extra insurance if the standard rental cover leaves you responsible for large excess charges or uncovered scenarios.
The basic protection that comes with most rentals limits what you’ll pay but doesn’t remove your financial risk entirely, and that’s often where travellers get caught out.
Let’s start with the excess. Even with a Collision Damage Waiver, you’re usually liable for the first £500 to £2,000 of any damage or theft claim. That means a small scrape or cracked windscreen could cost hundreds, and major damage could quickly reach your excess limit. For peace of mind, many renters choose to buy Excess Reduction or Super Collision Damage Waiver (SCDW), which lowers or removes that excess altogether.
You might also consider Personal Accident Insurance (covering medical expenses or death benefits for the driver and passengers) and Windscreen or Tyre Cover, both of which are often excluded from standard CDW policies. If you’re travelling in rural areas or on poor roads, those small add-ons can save you a big bill later.
Beyond the UK, the case for extra protection strengthens. In some countries, liability limits are lower, and medical costs higher. Renting in the US, for instance, often requires separate liability or supplemental insurance because local policies differ from European standards.
In short, additional insurance isn’t always a waste, it’s a safety net for the parts your default policy doesn’t reach. Whether you need it depends on where you’re driving, what risks you’re comfortable with, and how much excess you’re prepared to pay.
How can you check whether you’re already covered?
Before paying for extra insurance at the rental desk, check whether your travel, car, or credit card insurance already covers you.
Many drivers don’t realise they’re already protected, and end up paying twice for the same thing.
Start with your travel insurance. Most comprehensive travel policies include some level of personal accident and medical cover, and some extend this to car hire. The catch is in the fine print: many only apply if you’ve declared that you’ll be driving, or they exclude hired vehicles altogether. It’s worth calling your provider before you travel to confirm whether you’re covered behind the wheel.
Next, review your personal car insurance. Some comprehensive UK policies include a “driving other cars” extension or personal accident cover that follows you, even in a rental. However, these benefits can vary between insurers, and they often don’t apply overseas. A quick check with your insurer can clarify whether that protection extends to hire cars.
Credit cards are another overlooked safety net. Premium travel cards, such as American Express Platinum or certain Mastercard World Elite accounts, often provide car rental insurance automatically when you pay with the card. This can include collision damage and theft protection, but benefits are sometimes limited to the cardholder and may exclude luxury cars or long rentals.
You can also buy standalone excess insurance from a third-party provider before your trip. These policies typically cost £2–£4 per day and reimburse you if the rental company charges you an excess after damage or theft. It’s one of the most cost-effective ways to stay fully protected.
Here’s a quick checklist before you agree to any add-ons:
- Does your travel insurance cover driving a hire car abroad?
- Does your personal car insurance include personal accident or “driving other cars” cover?
- Does your credit card include CDW or theft protection when used for payment?
- Does your cover extend to passengers or just the main driver?
- Are there exclusions for luxury cars, long rentals, or certain countries?
A few minutes checking your existing policies can prevent unnecessary duplication, and help you decline confidently when the rental clerk starts their upsell routine.
Do you really need to buy extra insurance when renting a car?
You don’t always need to buy extra insurance when renting a car, but it depends on your existing cover, where you’re driving, and how much financial risk you’re comfortable taking.
For many UK drivers, the protection that comes with the hire agreement, plus their own travel or credit card insurance, is already enough.
The key question is how much of a financial buffer you want if something goes wrong. The default Collision Damage Waiver limits what you owe but still leaves you with an excess of up to £2,000. If that’s an amount you could absorb without major stress, you may decide not to buy any additional protection. But if the thought of a large, unexpected bill makes you uneasy, then paying a few pounds a day for excess reduction or standalone excess insurance can be worth it.
For renters abroad, additional insurance can be more than peace of mind, it can be essential. Some destinations have lower mandatory liability limits, meaning you could face personal claims for damage or injury that exceed the policy’s cap. In the US, for example, you’ll often be advised to buy Supplementary Liability Insurance (SLI) to reach adequate coverage levels.
If you’re hiring for business, carrying passengers, or travelling in regions with unpredictable road conditions, extra insurance can offer both financial and psychological security. On the other hand, if your trip is short, your routes are predictable, and your existing policies already cover accidents, declining the upsell is entirely reasonable.
The decision isn’t about buying everything, it’s about identifying the gaps. If your health, car, and travel policies leave you with minimal exposure, skip it. But if one of those pieces is missing, it’s worth filling that gap before you turn the ignition key.
What’s the best way to save money on car rental insurance?
The best way to save money on car rental insurance is to buy standalone excess insurance before you travel.
It provides the same protection as the rental company’s policy but at a fraction of the cost, often saving you more than half what you’d pay at the desk.
Most rental firms make significant profit on insurance add-ons, particularly excess reduction and damage waivers. While these can cost £15–£25 per day if bought directly from the hire company, independent insurers typically offer equivalent coverage for £2–£4 daily, or under £50 for a full annual policy. This means that a week-long rental could cost £140 in at-desk insurance or less than £30 if arranged in advance.
Standalone excess policies are easy to buy online from providers such as MoneyMaxim, Cover4Rentals, or Insurance4CarHire. They reimburse you if you’re charged by the rental company for damage or theft, covering excess amounts up to around £6,000. It’s the same peace of mind, delivered at a sensible price.
Another overlooked tip is to book through a credit card or travel platform that includes cover as a perk. Some premium cards, especially those aimed at frequent travellers, automatically provide collision damage and theft protection when you use them for payment. Always check the terms, as eligibility may depend on where the car is rented and for how long.
| Option | Typical Daily Cost (UK) | Coverage Limit | When It’s Best |
|---|---|---|---|
| Rental Company Excess Waiver | £15–£25 | Full protection | Short, last-minute rentals |
| Standalone Excess Insurance | £2–£4 | £5,000–£6,000 | Frequent travellers, advance bookings |
| Premium Credit Card Cover | Free (with card) | £30,000–£50,000 | Regular travellers, international rentals |
Finally, decline what you don’t need. Avoid unnecessary extras like tyre and windscreen insurance if your standalone policy already covers them, and resist pressure from sales staff who may imply you can’t hire without add-ons, in most cases, you can.
A little preparation before you travel almost always costs less than a rushed decision at the counter. Compare, confirm, and buy only what fills genuine gaps in your cover.
What happens if you rent a car without insurance?
If you rent a car without proper insurance, you could face thousands of pounds in repair bills or even legal claims after an accident.
While car hire companies must include basic third-party liability cover, declining additional protection can leave you personally responsible for damage to the vehicle or injuries to yourself.
At a minimum, third-party insurance ensures you meet legal requirements, but it doesn’t protect you financially if the rental car is damaged or stolen. In those cases, the hire company will charge you for repairs or the full excess stated in your contract, often between £500 and £2,000, and sometimes more for luxury or specialist vehicles.
The situation worsens abroad. In some non-EU countries, liability limits are much lower, and serious accidents could expose you to out-of-pocket legal claims or hospital bills. Without supplemental liability or medical coverage, you could be held personally responsible for costs that exceed the minimum protection included with the car.
Even smaller incidents can become expensive. Lost keys, punctures, or cracked windscreens are often excluded from standard CDW policies. Without extra cover, those minor mishaps can quickly turn a cheap rental into an expensive mistake.
In short, hiring without adequate insurance is technically possible, but financially risky. You’ll meet legal requirements with basic cover, but you’re betting your own wallet against the cost of an accident. For most drivers, that’s not a gamble worth taking.
Final thoughts
Renting a car should be straightforward, but the layers of insurance can turn a simple hire into a confusing purchase. The truth is, you always need some level of cover, it’s the law, but you don’t need to accept every extra that’s offered.
A confident renter knows what’s already included, what’s duplicated elsewhere, and where the real financial gaps lie. For most people, that means relying on the standard protections that come with the hire, backed up by travel or credit card insurance, and filling any gaps with a low-cost standalone excess policy bought in advance.
The key is preparation, not panic. Read the terms before you travel, check your existing cover, and avoid making quick decisions at the rental desk. When you know what you’re covered for, you’ll save money, protect yourself properly, and drive away without uncertainty hanging over the trip.
Frequently Asked Questions (FAQs)
All rental cars must include third-party liability insurance by law. This covers injury or damage you cause to other people or property, but not damage to the hire car itself.
Some comprehensive car insurance policies include personal accident or “driving other cars” cover that may extend to rentals. However, this usually applies only within the UK and may exclude foreign hires.
Many premium travel or credit cards include collision damage and theft protection when you pay with the card. Coverage varies, so check the terms before assuming you’re protected.
A Collision Damage Waiver limits your financial responsibility if the rental car is damaged. It’s not full insurance but reduces your liability to an agreed excess, typically between £500 and £2,000.
Some travel insurance policies cover car rental accidents, but many exclude hired vehicles unless declared in advance. Always check your policy wording before relying on it.
Excess insurance reimburses you for the amount the rental company charges after damage or theft. It’s often far cheaper from third-party providers than at the rental desk.
Without proper cover, you’ll be responsible for repair costs up to the car’s full value. Even minor damage, like a dent or scratch, can result in charges of several hundred pounds.
Buy standalone excess insurance before you travel, compare offers online, and decline duplicate add-ons. Using a credit card with built-in cover can also save money.