Understanding the implications of making a claim on your self-drive hire insurance policy: a guide for vehicle owners
In recent years, the rise of self-drive hire services has transformed the way people rent vehicles, offering convenience and flexibility for travellers and businesses alike. However, with this convenience comes the responsibility of understanding how insurance works in the event of an accident or damage while your vehicle is rented out.
Self-drive hire insurance typically covers both the vehicle owner and the renter in the event of an accident or damage during the rental period. However, the implications of making a claim can vary depending on the specific terms and conditions of the insurance policy. Here’s what vehicle owners need to know:
Initial steps
When alerted to an incident involving your vehicle, in a non-emergency situation contact us either on 01603 649744 or complete the details of your claim here. If it is an emergency, you can find the relevant number direct to your insurer here. Once all the information has been received, we’ll progress your claim with the aim of reaching an agreed settlement.
Impact on premiums
Making a claim on your policy can potentially impact your future premiums, even if you weren’t driving the vehicle at the time of the incident. Insurance companies may view you as a higher risk if your vehicle has been involved in accidents or claims, which could result in an increased premium or excess. It’s essential to consider this potential consequence before renting out your vehicle and calculating what prices you’ll be charging customers.
Excess and deductibles
Most self-drive hire insurance policies include an excess you’d be responsible for paying in the event of a claim. Be sure to review your insurance policy carefully to understand your financial obligations and ensure the excess you charge a hirer is at least equal to the excess you’d pay when making a claim. Your policy is also likely to include a co-insurance clause, which would come into effect on a theft-by-hirer claim, leaving you responsible for a proportion of the loss. Finally, you should make sure your hire contract is clear on the subject of excess and claims – you may want to take legal advice on this area.
No claims bonus
If you have a no claims bonus on your personal insurance policy, making a claim through a self-drive hire insurance policy may not affect it directly. However, if your personal insurance is involved in covering the vehicle, any claims made could potentially impact your bonus. Again, it’s essential to understand how claims on your rental vehicle may affect your personal policy.
Repair process
After a claim is filed, the vehicle may need repairs before it can be rented out again. The insurance provider will typically arrange for repairs to be carried out at approved garages or repair centres. Depending on the extent of the damage, this process may take some time, during which your vehicle may be out of commission, affecting your rental income.
Reviewing cover limits
It’s crucial for vehicle owners to regularly review the cover limits and terms of their self-drive hire insurance policy. As the popularity of self-drive hire services continues to grow, insurance providers may update their policies or offer additional cover options to better protect vehicle owners and renters, such as public liability insurance, cyber insurance and directors’ and officers’ insurance.
While self-drive hire insurance provides valuable protection for vehicle owners and renters, it’s essential to understand the implications of making a claim. By familiarising yourself with your insurance policy and staying informed about any changes or updates, you can effectively manage risks and ensure that your self-drive hire business operates smoothly and responsibly. For further guidance, speak to our self-drive hire team on 01603 649744.
