The excess is one of the most important things to check when renting a car, as it determines how much you may have to pay in the event of damage, theft or other circumstances covered by the rental agreement.
The amount can vary considerably depending on the car rental company, the vehicle category, the rate selected and the protection purchased. For this reason, comparing the daily rental price alone is not enough: before booking, it is also important to check the excess amounts, insurance exclusions and any additional protection that can reduce or waive the excess.
In this guide, we explain what the excess on a rental car is, how it works, when you may be charged and how it differs from the security deposit.
What is the excess on a rental car?
When renting a car, the excess — also known as a deductible, particularly in North America — generally refers to the maximum amount for which the customer may be financially liable if a specific event covered by the rental agreement occurs, such as damage to the vehicle or theft.
For example, suppose the rental agreement includes a damage excess of €1,000.
If the vehicle suffers damage covered by the applicable damage waiver and the amount chargeable to you is €300, you may be required to pay €300 rather than the full €1,000 excess.
If the damage amounts to €2,000 and the protection included in the agreement limits your liability to €1,000, you may generally be liable for up to the maximum amount specified in the rental terms.
The excess is therefore a limit on your financial liability, not an amount that is automatically charged every time you rent a car.
You should always read the rental company’s terms and conditions carefully, as limits, protection and exclusions can vary.
Damage excess and theft excess: what is the difference?
There is not always just one excess. Rental agreements often include at least two different liability limits: the damage excess, which applies to damage caused to the vehicle during the rental period, and the theft excess, which may apply in the event of total theft or, where specified in the terms, attempted theft or partial theft.
The two amounts may be different.
For example, a rental company might apply:
- a damage excess of €800;
- a theft excess of €1,200.
Some rental companies may also apply specific conditions to certain vehicle categories or to theft occurring in particular geographical areas.
For this reason, when comparing two car rental offers, it is useful to check damage liability and theft liability separately, rather than simply checking whether the rate generically mentions an “excess”.
How does the excess work when renting a car?
The easiest way to understand how the excess works is through an example.
Imagine renting a car with:
damage excess: €1,000
During your rental, you accidentally damage the vehicle’s bodywork.
If the assessed and chargeable damage amounts to €250, you may be required to pay €250.
If the amount is €750, your liability may be up to €750.
If, on the other hand, the damage amounts to €2,500 and the protection included in your agreement effectively limits your liability to €1,000, you would normally not be required to pay the full repair cost, but no more than the amount specified in the rental agreement.
This principle applies, however, only to events and types of damage covered by the applicable liability limitation.
This is one of the most important points to understand before renting a car.
When do you have to pay the rental car excess?
The fact that an excess is included in your rental agreement does not mean that you have to pay it when you collect the car.
The excess generally becomes relevant only if an event covered by the rental agreement occurs, such as damage or theft for which the customer is held liable.
Depending on the rental company’s terms, the vehicle may be inspected when it is returned. If new damage is identified, the company may start the applicable procedure to assess its nature and cost.
Any amount due may then be charged using the payment method provided by the customer or, where applicable, deducted from amounts secured through the security deposit.
It is therefore important not to confuse the moment when the security deposit is provided with the moment when you may be required to pay for damage or an applicable excess.
Are the excess and security deposit the same thing?
No. The excess and the security deposit are two different things, although they are often connected in practice.
The excess is the limit of the customer’s financial liability for a particular event, according to the rental terms.
The car rental security deposit, on the other hand, is a financial guarantee requested by the rental company when you collect the vehicle or shortly beforehand.
The deposit may be used to secure not only potential damage charges, but also other amounts that may arise during the rental, such as missing fuel, extra rental days, excess mileage or other charges provided for in the agreement.
For this reason, the amount of the security deposit does not necessarily have to match the excess.
A vehicle could, for example, have a damage excess of €1,200 while requiring a security deposit of a different amount.
Before booking, it is advisable to check which card is required for the deposit, whose name must appear on the card and how much available credit is required when collecting the vehicle.
You can find more information in our guide to renting a car without a credit card.
What is CDW in car rental?
One of the most common abbreviations in car rental agreements is CDW, which stands for Collision Damage Waiver.
CDW is a limitation of the customer’s financial liability for certain types of damage to the rental vehicle, subject to the terms and conditions of the rental agreement.
In practical terms, CDW may mean that, in the event of covered damage, the customer is not liable for the full value of the damage but only up to the applicable excess.
For example, if the vehicle suffers €3,000 worth of damage and the rental agreement limits the customer’s liability for that event to €900, the customer may be required to pay up to the limit specified in the applicable terms.
However, CDW should not be understood as complete protection against every possible type of damage.
It is important to check which parts of the vehicle are covered, which are excluded and which actions or circumstances may invalidate or restrict the protection.
Are CDW and LDW the same thing?
Car rental agreements may also use the abbreviation LDW, which stands for Loss Damage Waiver.
The terminology is not used in exactly the same way by every rental company. In some agreements, LDW refers to broader protection against loss of or damage to the vehicle, while in others damage and theft protection are described separately.
For this reason, you should not rely on the abbreviation alone.
The most important thing is to check what your chosen rate actually includes, how much excess remains your responsibility and which exclusions apply.
Which types of damage may not be covered by the excess?
One of the most common misconceptions is that, whenever an excess applies, your maximum cost for any type of damage to the vehicle will always be limited to that amount.
This is not necessarily the case.
Terms vary between rental companies, and standard protection may include specific exclusions.
Depending on the rental agreement, examples of parts or events that may be excluded from standard protection include:
- tyres and wheels;
- windows and windscreens;
- the undercarriage;
- the roof;
- the interior;
- lost or damaged keys;
- refuelling with the wrong type of fuel;
- damage caused by unauthorised use of the vehicle.
You should always check whether these or other exclusions apply under the specific terms of your rental.
When might the liability limitation not apply?
The protection included in a rental agreement is generally subject to compliance with the rental terms and conditions.
As a result, the protection may not apply, either fully or partially, if the vehicle is used in breach of the contractual conditions.
The exact circumstances vary between companies, but they may include, for example, driving by someone who is not authorised under the rental agreement, using the vehicle in unauthorised territories, certain forms of improper use, or conduct that breaches the law or the agreed rental conditions.
If you plan to drive your rental car abroad, it is particularly important to check before departure which countries are permitted by the rental company.
The same applies to roads, ferry crossings or territories that may be subject to specific restrictions.
What does car rental with no excess mean?
The term car rental with no excess generally refers to a rental in which the customer’s financial liability for certain types of damage or theft is reduced to zero through a specific protection package.
However, this does not necessarily mean that every possible event is covered or that the customer can never be charged anything.
Even zero-excess protection may still be subject to exclusions, contractual obligations and limitations.
It is therefore more accurate to say that the excess is waived for the events expressly covered by the protection purchased.
You can learn more in our dedicated guide to car rental with no excess.
Does zero excess also mean no security deposit?
No. This is another point that often causes confusion.
A zero excess does not automatically mean that no security deposit is required.
The rental company may still require a security deposit to cover costs that are unrelated to the excess, such as fuel, extra rental days, fines and related administration fees, excess mileage or other amounts provided for in the agreement.
In some cases, purchasing more comprehensive protection may also reduce the amount of the security deposit, but there is no single rule that applies to every car rental company.
You should therefore check three things separately: the damage excess, the theft excess and the security deposit.
How to reduce or waive the rental car excess
When booking or collecting the vehicle, you may be offered additional protection that reduces your financial liability compared with the standard protection included in the rental rate.
Depending on the rental company, these options may be sold under names such as Super CDW, Super Cover, Premium Protection, Zero Excess or other commercial names.
The protection may reduce the excess, for example from €1,000 to €300, or waive it entirely for the events covered.
Before purchasing additional protection, however, it is important to check exactly which types of damage are included.
Zero-excess protection for the vehicle’s bodywork, for example, may not automatically cover tyres, windows, the undercarriage or other components.
Rental company protection or third-party insurance: what is the difference?
The excess can also be covered or reimbursed through insurance products purchased from intermediaries or companies other than the car rental provider.
However, it is important to distinguish between two different mechanisms.
If you purchase excess-reduction protection directly from the rental company, your liability towards the rental company is modified according to the conditions of the protection selected.
A third-party insurance policy, on the other hand, may work as excess reimbursement insurance.
In the event of damage, the rental company may therefore charge you the amount due under the rental agreement, after which you would need to submit a claim to the third-party insurer for reimbursement and provide the required documentation.
For this reason, zero-excess protection offered directly by the rental company should not automatically be considered equivalent to a third-party excess reimbursement policy.
How much is the excess on a rental car?
There is no standard amount.
The excess can vary depending on several factors, including:
- vehicle category;
- car rental company;
- pick-up location;
- selected rate;
- rental duration;
- protection included in the rate;
- optional protection purchased.
Higher vehicle categories may also have different liability limits compared with smaller or less expensive cars.
To find out the exact amount, you therefore need to check the specific terms and conditions of your booking.
A practical example: excess, security deposit and damage
Suppose a rental has the following conditions:
damage excess: €1,000
theft excess: €1,500
security deposit: €500
The €500 security deposit is pre-authorised on your card when you collect the vehicle.
If you return the car without damage and there are no other charges, the pre-authorisation is released according to the applicable procedure.
If covered damage worth €350 is identified, you may be required to pay €350.
If the covered damage amounts to €1,800, your liability may be limited to €1,000, depending on the conditions of the applicable protection.
As this example shows, the security deposit and excess have different amounts and serve different purposes.
What to check before booking a rental car
Before choosing a rental car, it is important not to focus only on the price shown on the first booking screen.
In particular, check:
- the damage and theft excess amounts;
- the amount of the security deposit;
- how the deposit must be provided;
- which types of damage are excluded from the protection;
- the cost of any optional additional protection.
You should also check the requirements for the card that must be presented when collecting the vehicle and make sure you have enough available credit for any required pre-authorisation.
Checking these details will help you compare apparently similar offers more accurately and reduce the risk of unexpected conditions at the rental desk.
What to do when collecting and returning the car
Even if you have comprehensive protection, it is advisable to inspect the vehicle carefully.
When collecting the car, check that any existing damage is recorded in the documentation provided by the rental company. It can also be useful to take and keep photographs or videos showing the condition of the vehicle, with particular attention to the bodywork, wheels and windows.
When returning the car, whenever possible, inspect it together with a member of staff and keep any documentation confirming the closure of the rental agreement.
These are simple precautions, but they can be useful if any dispute later arises over whether damage was already present or when it occurred.
Frequently asked questions about rental car excess
Is the excess always blocked on your card?
No. What is normally pre-authorised or requested as a guarantee is the security deposit. The amount of the deposit may be different from the excess.
If the damage costs less than the excess, do I have to pay the full excess?
Not necessarily. As a general rule, if the amount of chargeable damage is lower than your liability limit, you will normally be charged for the relevant damage amount rather than automatically paying the full excess. You should still check whether the rental agreement includes any additional charges or conditions.
If the damage exceeds the excess, how much do I pay?
If the damage is fully covered by the applicable protection and the rental agreement limits your liability to a specific amount, you will normally be liable only up to that limit. Contractual exclusions may, however, affect how this applies.
Can a rental agreement have two different excess amounts?
Yes. It is common to have one excess for damage and another for theft, and the amounts may be different.
Does zero excess mean I will never have to pay anything?
No. A zero excess normally applies only to events expressly covered by the protection purchased. Exclusions, non-insurance charges and contractual obligations may still apply.
Do I still need to provide a deposit if I have zero excess?
Possibly. A security deposit may still be required because the excess and security deposit serve different purposes.
Can I insure the excess with a third-party company?
Yes. Some insurance products offer reimbursement of certain amounts paid by the customer. However, it is important to check the terms, coverage limits, exclusions and claims procedure, as these policies are not necessarily equivalent to protection purchased directly from the rental company.
With Ellepirental, you can compare the available options for your car rental in Sardinia and choose the vehicle and rental conditions that best suit your trip.
