Short-Term Rental Insurance Explained

By Daniel Moreau · Published Oct 5, 2026 · 6 min read

In this guide

How excess insurance works
The upside
The catches
What may not be covered
Protect yourself at pick-up

When you rent a car, you are typically responsible for an excess (deductible) if the car is damaged or stolen, which can be substantial.

Standalone rental excess insurance, bought separately from the rental company, is one way to cover that risk.

How excess insurance works

If you damage the rental car, the rental company charges your card up to the excess amount. You then claim that amount back from your excess insurer with documentation.

The upside

Standalone excess policies are often cheaper than the rental company’s waiver, and annual policies can be good value for frequent renters.

The catches

You must pay the rental company first and claim afterwards
The rental company may still require a large deposit on your card
Some policies exclude certain vehicles, drivers, or countries
Claims require paperwork: rental agreement, damage report, and receipts

What may not be covered

Some policies exclude tyres, windscreens, roof, and undercarriage, or cover them only as an add-on. Read the policy wording carefully.

Protect yourself at pick-up

Photograph and video the car before driving away and at return, including the fuel gauge and mileage, to avoid disputes.

This is general insurance information, not legal, financial, or insurance advice. Coverage depends on your specific policy, insurer, and jurisdiction. Read your policy documents and speak with a licensed insurance agent or broker before making decisions.

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Short-Term Rental Insurance Explained

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