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Are rental cars insured in Australia?

Two drivers inspecting damage after traffic accident in AU

Car rental companies in Australia have their own insurance for their vehicles, however an excess amount will still apply. The Rental Vehicle Excess amount, or the Damage Liability Fee, is the amount that the customer is liable to pay if any damage is caused to the vehicle while it is in their possession. 

In Australia, this amount generally ranges from $4000 - $8000. The amount is dependent on the car type, the pick-up location and the specific supplier. This means that customers are not liable to pay the full replacement cost of a vehicle, however they may be charged up to the rental vehicle excess amount. 

 For Example:

David had a car accident

David rents a car in Australia, with a rental vehicle excess of $4,500. While driving, David is involved in a car accident. The car rental company assesses the damage to the vehicle to be worth $5,000. This means that David will be charged $4,500 for the damage, with the car rental company covering the additional $500. David is only liable to pay the excess amount.

To find out how you can reduce your rental vehicle excess amount, click here