A Collision Damage Waiver (CDW) is also known as a Loss Damage Waiver (LDW) in some countries. It’s a specific type of insurance you may be asked to take out when you’re picking up a hire car – it’s often compulsory, and you may not be allowed to hire the car without it.
Why do companies put CDWs in place?
Hire cars are normally only covered with third party insurance. Having a CDW in place usually means you’re reducing your liability for the full costs involved if the car is stolen or damaged while it’s in your care. Most companies insist on you agreeing to pay an excess fee instead of those costs, which can be upwards of £500.
How do you buy a CDW?
Car rental companies often sell their own CDW when you pick up the car. Buying their insurance means that, if the car is damaged or stolen, they can keep your deposit and charge you the excess you’ve agreed to – but then your liability will usually stop there.
For extra protection, some companies offer a ‘super’ CDW, also known as an excess waiver, which means you won’t have to pay the excess either. Buying this can be relatively expensive, but the costs associated with not being covered at all could be much higher.
Can I buy a CDW separately?
Yes you can, usually. But you’ll need to arrange your CDW before you travel, and not all hire companies will be set up to accept a pre-arranged, independent policy instead of their own.
And in most cases, if you decide to arrange your own insurance, you’ll need to make sure you also have funds available on a credit card in case something happens. Then, if the car is damaged or stolen, you can pay any excess to the rental company and make a claim from your insurer when you get home. In all cases, keep your hire documents safe, and make sure you get copies of any paperwork with details of amounts you need to claim.