vacation car rentals travel key tips

Vacation Car Rentals: 10 Key Tips

Rental cars and vacations go hand in hand. Get tips on how to save money, avoid unpleasant surprises and stay properly insured when renting cars in this moneyland.ch guide.

Vacations are rarely complete without rental cars. Whether getting your hair teased by a salty breeze while maneuvering a budget convertible along a winding seaside road or touring one of the world’s less-travelled regions in an off-roader, chances are you will be sitting in a rental car.

Rental cars provide a convenient, private and flexible way to get around which is unmatched by virtually all other forms of transportation. But while the majority of car rentals transpire without incident, there are numerous glitches which can throw a monkey wrench into your car rental experience – costing you time in the best case and ruining your vacation and possibly your bank balance in the worst case.

Here, moneyland.ch lists 10 tips to consider for a hassle-free car rental:

1. Think twice before booking through rental car comparison platforms and travel booking platforms

Car rental comparison platforms provide a convenient way to compare offers from many different car rental companies and find good deals. But while the comparison features are useful and comparing is highly recommended, booking car rentals through these platforms is not always a good move.

Firstly, the prices shown often do not account for all applicable costs (taxes, insurance coverage, collision damage waivers) because these websites want to appear cheaper than travel agencies and direct car bookings with car rental companies.

Secondly, by booking a car rental through a third-party comparison website, you agree to the third party’s terms and conditions. Many foreign online car rental comparison websites have somewhat customer-unfriendly terms and conditions (with regards to refunds, for example). If you are unable to collect the vehicle – due to an issue with your driver’s license or credit card, for example – you will have to deal with the third-party comparison service provider rather than the rental car company.

Many popular car rental comparison platforms do not refund your payment if you are unable to collect the vehicle due to an oversight on your part. Rental car companies, on the other hand, generally charge a fixed penalty fee rather than claiming your entire payment.

Travel booking platforms may seem like a convenient way to book rental cars because they account for offers from various car rental companies and typically let you book a car rental along with your flight or hotel. But while the convenience is an advantage, there are also disadvantages to booking car rentals this way. Like comparison websites, travel booking platforms have their own terms and conditions and you will have to deal with the platform’s operator if anything goes wrong with your booking. Review the terms and conditions attached to rental car bookings before using a travel platform to book car rentals. Ideally, you will want to book through a platform which at least has a representative office in Switzerland which you can contact should problems arise.

2. Consider your payment options

Multinational rental car companies generally require that you present a credit card when you collect rental cars. Using credit cards to pay for car rentals can be financially advantageous if the credit card’s complimentary benefits include rental car discounts or insurance perks. But if you only have one credit card with a limited line of credit and you use that card to settle large payments ahead of collecting a rental car, you risk being left with too low a line of credit for the required credit hold (more on this below).

If you prefer not to use credit cards at all, then making rental car bookings can prove difficult. Some rental car companies, such as those in the Enterprise group (Enterprise, Alamo, National), generally do not accept cash deposits, and also do not accept cash payments for car rentals at most branch offices (including branch offices in Switzerland).

Car rental company Budget only accepts credit card payments, although its Swiss offices will accept cash in exceptional cases. Other car rental companies, including Avis and Hertz, are more accommodating when it comes to cash payments and deposits, particularly with regards to bookings made by residents of Switzerland at their Swiss branch offices.

However, your choice of rental cars may be limited when you make a cash deposit or pay in cash. Small, local rental car companies and agencies – such as those found at many popular vacation destinations – also tend to be more customer friendly in this regard, accepting deposits and payment in cash or via debit card.

3. Make sure your credit card’s line of credit is adequate

Many car rental companies require that you present a credit card when you collect a rental car. The reason for this is that they typically place a hold on a portion of your credit line in place of holding a deposit in cash. Typically, this credit hold is several hundred Swiss francs, but in the case of expensive rental cars such as sports cars and luxury cars it can amount to several thousand francs. If your remaining line of credit is insufficient at the time that you collect the rental car, you will not be able to collect it and risk paying a penalty fee for not collecting the booked vehicle (or losing your entire payment in the case of bookings through third-party platforms).

For this reason, it is crucial that your credit card has a sufficient line of credit at the time that you collect the rental car. If you are not sure whether or not your line of credit is sufficient, consider asking your card issuer to extend your credit line. When you rent particularly expensive vehicles, you may be required to present two credit cards in order to insure an adequate credit hold. In some countries, the branch offices of certain rental car companies will also accept prepaid cards or debit cards in place of credit cards, but only if there is sufficient money in your prepaid account or bank account to satisfy credit hold requirements.

4. Use an embossed credit card

Some rental car company branch offices only accept credit cards with embossed card numbers. In some cases, using a credit card with an embossed card number can also allow you to collect rental cars when telecom or power cuts prevent electronic transactions – which is not uncommon in many more exotic locations.

5. Take advantage of credit card discounts

If you use a credit card to pay, take the time to check whether your credit card provides rental car discounts. There are a number of Swiss credit cards which entitle you to discounts on car rentals, but you generally have to provide a discount code when you make the booking – you do not get the discount automatically just by using the card to pay. Some cards have the rental car discount code printed on their side. Others do not, and the discount code must be obtained from the issuer or through their website.

6. Pay attention to credit card foreign transaction fees

When you use a credit card to pay for a rental car booking from an online portal or rental car company outside of Switzerland, you pay a foreign transaction fee and a currency exchange spread. This can add a significant expense to the cost of a car rental (up to 3% or even 4%). If you plan to book a rental car through a foreign comparison site or booking platform, or if you plan to rent a vehicle directly at a car rental agency at your destination, make sure to account for the credit card foreign transaction fee when calculating the total cost. You can find more information in the moneyland.ch guide to credit card foreign transaction fees.

7. Take all costs into account

Some rental car comparison platforms do not account for all costs associated with a booking. For example, you may still have to pay taxes, insurance premiums, value added tax (VAT), airport fees, accident administration fees (if you have an accident), roadside assistance fees and other incidental costs on top of the advertised price. Swiss consumer protection laws require merchants to include all costs in advertised prices, but greater care is required when using foreign service providers.

Make sure you understand which costs are included in the booking and which additional costs must be paid when you collect or return the rental car. Having a good understanding of the full costs of a car rental makes comparing prices easier. For example, booking a rental car through a rental car agency, travel agency or travel portal in Switzerland may work out as cheap as booking through a foreign portal in some cases, when all costs are considered.

8. Avoid double insurance

Rental car agencies, travel booking platforms, travel agencies and comparison platforms generally offer some form of insurance or waiver when you make a rental car booking. Some offer liability, collision and comprehensive insurance or damage waivers separately, while others lump all of these into a single package (typically under their collision damage waiver). Most commonly, this is an agreement by which the rental car company waives their right to hold you responsible for all or part of the cost of damages to or loss of the rental vehicle which is not covered by insurance.

Getting this waiver is recommended, but it can add a major cost to your rental. It is worth noting that a number of Swiss credit cards provide a collision damage waiver as a complimentary benefit, with some even providing actual car insurance. The amount covered by the waiver varies between credit cards. You can find out whether your credit card has this benefit and how much coverage it provides by clicking on the corresponding info link in the moneyland.ch credit card comparison. The Insurance: car rental sort criteria lets you sort credit cards based on the rental car insurance benefits which they provide.

Liability for damages to rental cars may also be covered – at least in part – by your car insurance policy. Car insurance from Helvetia, for example, may include an optional rider which covers up to 2500 Swiss francs of liability for damage to rental vehicles.

9. Protect yourself from liability claims

Law suits or liability claims resulting from accidents which you cause can climb into the millions of francs, which is why it is crucial to make sure that you are adequately covered against liability claims. In many (but not all) countries, rental car companies are required to get liability car insurance for their fleet. The amount which is not covered by insurance may be waived – either in full or in part – by the collision damage waiver offered by the rental car company. But in some cases, the amounts covered by the insurance and waived by the collision damage waiver are nowhere near enough to cover serious liability claims. This is particularly true for car rentals in the Unites States and Canada, and for car rentals in countries which either do not have compulsory third-party liability car insurance requirements or have very low minimum liability car insurance requirements.

Some Swiss personal liability insurance policies cover damages or injury to third parties caused by you when driving a rented car. Review the terms and conditions of the policy to determine whether third-party liability resulting from the use of vehicles owned by third parties is covered. Depending on the policy you hold, you may already be covered against liability for injuries or damages you inflict when driving rental cars. Some policies limit coverage to borrowed vehicles only (no rental vehicles), or to specific regions. For example, personal liability insurance from Allianz Suisse limits liability coverage for rental car use to (most) European countries.  As a general rule, your personal liability insurance only covers the difference between the liability insurance provided by the vehicle’s policy and the full amount for which you are liable (up to the maximum sum insured). If coverage for rental cars is not explicitly stated in your personal liability insurance policy’s terms and conditions, contact your insurance provider and ask.

Some Swiss car insurance policies include third-party liability coverage for rental cars driven by an insured person. This is the case, for example, with car insurance policies from Baloise, TCS (underwritten by Baloise) and Smile Direct and the Premium policy from Sympany. Coverage is secondary and extends the coverage provided by the rental car’s insurance. It is typically limited to certain countries as per the geographical limitations of your car insurance policy. If you own a car and hold a Swiss car insurance policy, check the terms and conditions of the policy to determine whether it provides additional insurance coverage.

10. Consider getting rental car insurance from a third party

Accepting the collision damage waiver and liability insurance offered by travel booking platforms or by the staff at rental car agencies is convenient, but it has its disadvantages. Inadequate consultation may result in your not being properly covered, or in your buying completely unnecessary insurance or waivers. Online platforms and rental car agency staff generally earn high commissions for sales of insurance and collision damage waivers, so they have every incentive to sell you as much insurance as possible. If you buy insurance at the agency when you collect the car, you may find linguistic barriers can pose a problem as well. If an incident occurs you may find yourself having to deal with a foreign insurance company in a far-away country long after returning to Switzerland.

An alternative is to take out a rental car insurance policy (such as that offered by Swiss insurance provider ERV) for the relevant timeframe before you begin your vacation. By getting insured in Switzerland you avoid having to deal with linguistic barriers and sales pressure when you reach your destination, and you can easily deal directly with the insurance company when you return to Switzerland after your trip should any incidents occur. Typically, rental car insurance policies apply worldwide and also include a collision damage waiver.

Conclusion

Car rental comparison sites provide a useful guide for finding good deals on rental cars but booking rentals directly with car rental companies is generally a more secure and flexible option. Using the right payment method and taking the time to find out whether you are entitled to discounts or insurance benefits for car rentals can help you avoid paying more than necessary – leaving you with more money to pocket or blow on good times and souvenirs. Getting rental car insurance from a Swiss insurance provider before you travel will help you avoid stress, confusion or rip-offs at your destination and lets you deal with a local partner after you return to Switzerland as opposed to dealing with a foreign company in a different legal jurisdiction.

More on this topic:
Tips for cheaper car rentals
How to use credit cards to save on car rentals
Credit card comparison
Travel insurance comparison
Car insurance comparison

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The moneyland.ch magazine provides accurate, unbiased information on topics related to finance and money. In addition to research and expert interviews, the magazine contains numerous financial guides.